The only way that rich people could pay Bernie Sanders’s proposed annual 8% wealth tax would be by selling enough stock to get the money to pay the tax. This would drive down stock prices, and would hurt every single middle class person who has a pension, a 401K, or an IRA.

Billionaires don’t just have billions of dollars in cash just sitting around, waiting to pay Bernie Sanders’s proposed annual 8% wealth tax.

For example, the richest person in the world is Jeff Bezos, the guy who created amazon. 99.9% of his wealth is in the form of stock in the company that he himself created. In the beginning, that company was worth zero. The only reason that it has value today is because he created that value. The stock in any company is worth only as much as what people are willing to pay for it.

If Sanders forced Bezos to pay an 8% annual wealth tax, Bezos would have to sell enough of his amazon stock to get the money to pay the tax.

That would drive the price of the stock down.

And that would hurt every single middle class person who has a pension, a 401K, or an IRA.

And it gets even worse than that.

Sanders tried to justify his annual 8% wealth tax by saying

“Billionaires should not exist.”

But if billionaires don’t exist, then the companies that those billionaires created would not exist either.

And the goods and services that are provided by those companies would not exist either.

Which is why Sanders also said that people in the U.S. have too many choices when it comes to deodorant and shoes, and that it’s a “good thing” when people have to wait in line to buy food.

Sanders said that Americans have too many choices when it comes to deodorant and shoes. These are his exact words:

“You don’t necessarily need a choice of 23 underarm spray deodorants or of 18 different pairs of sneakers when children are hungry in this country.”

Well, as it turns out, the policies of Hugo Chavez and Nicolas Maduro have caused a shortage of both deodorant and shoes in Venezuela.

Sanders also said that it was a “good thing” when people have to wait in line for food.

These are Sanders’s exact words:

“It’s funny, sometimes American journalists talk about how bad a country is, cause people are lining up for food. That’s a good thing! In other countries people don’t line up for food: the rich get the food and the poor starve to death.”

You can see and hear Sanders saying those words in this video:

https://www.youtube.com/watch?v=zJBjjP8WSbc

Well, as it turns out, the policies of Chavez and Maduro have caused shortages of food in Venezuela.

For example, in May 2017, the Washington Post reported:

In a recent survey of 6,500 Venezuelan families by the country’s leading universities, three-quarters of adults said they lost weight in 2016 — an average of 19 pounds… a level of hunger almost unheard-of outside war zones or areas ravaged by hurricane, drought or plague.

Then in February 2018, Reuters reported:

Venezuelans reported losing on average 11 kilograms (24 lbs) in body weight last year… according to a new university study…

That’s 43 pounds in two years.

Here’s a photograph from 2014 of people in Venezuela waiting in line for food: (posted here under fair use from http://www.businessinsider.com/long-food-lines-are-in-venezuela-2014-2 )

You can read all about how Venezuela ended up like this at this link.

All of this happened in Venezuela because Chavez and Maduro decided to wage war against the rich.

What is exactly what Sanders is trying to do.

In fact, I have never, ever heard Sanders criticize any of the specific economic policies of Chavez or Maduro.

Sanders hasn’t criticized Chavez or Maduro for setting price controls on food.

Sanders hasn’t criticized Chavez or Maduro for nationalizing farmland.

Sanders hasn’t criticized Chavez or Maduro for nationalizing the electric, steel, cement, and construction industries.

On the contrary, every single economic policy that Sanders has ever expressed support for adopting in the U.S. is completely in line with the economic policies that were enacted by Chavez and Maduro in Venezuela.

You cannot help the poor and the middle class by hurting the rich people who provide the goods and services, as well as the jobs, that the poor and the middle class need.

Bernie Sanders’s hatred for the rich exceeds any concern for the poor and the middle class that he claims to have.

Sanders would rather hurt the middle class and the poor, as long as it also meant that he got to hurt the rich.

A falling tide lowers all ships.

Sanders has repeatedly criticized the existence of “millionaires and billionaires.” (Although he stopped doing so after the New York Times reported that he was one of them.)

Sanders defended his own millionaire status by saying the following:

“I wrote a best-selling book. If you write a best-selling book, you can be a millionaire, too.”

I agree with Sanders.

But here’s the difference between what I believe and what Sanders believes: I believe that it’s a good thing when any person becomes a millionaire or billionaire by providing their customers with the goods and services that their customers choose to buy. By comparison, the only person whose millionaire or billionaire status Sanders has ever defended is his own.

And I never trust anyone who doesn’t hold themselves to the same standards that they expect everyone else to follow.

October 9, 2019. Tags: , , , . Bernie Sanders, Economics. 1 comment.

Why a “Billionaire” Wealth Tax Would Hurt the Working Poor and the Middle Class

https://fee.org/articles/why-a-billionaire-wealth-tax-would-hurt-the-working-poor-and-the-middle-class/

Why a “Billionaire” Wealth Tax Would Hurt the Working Poor and the Middle Class

Although the wealth tax was drafted with the poor in mind, its passing could cause them more harm than benefit.

By Mark Hornshaw

October 4, 2019

Vermont Senator Bernie Sanders wants to tax billionaires out of existence, or at least make them an endangered species. His proposed wealth tax of up to 8 percent per year would mean “the wealth of billionaires would be cut in half over 15 years,” he says.

The progressive tax would start at 1 percent on retained wealth over $32 million, rising to 2 percent over $50 million, and so on, reaching to the top rate of 8 percent on wealth over $10 billion. Whatever is left would be taxed again the following year, and every year until it was gone.

Let’s assume for the sake of argument that you don’t have an ethical problem with taxing people a second time on wealth that has already been taxed. And let’s set aside the issue of whether billionaires would simply leave their wealth on the table for Sanders to take, rather than fleeing to places with less ambitious governments. Let’s posit for the sake of argument that the tax achieves its aims.

The question then becomes, would it be beneficial for the working poor who Sanders is appealing to? Would it leave them better off or worse?

Net Worth Isn’t What You Think It Is

Amazon founder Jeff Bezos has a net worth of $109 billion, according to Bloomberg. If you think you can get a decent abode for $1 million, then it seems like he could buy 109,000 plush houses. Does anybody need that much wealth? Wouldn’t it be better off going to people who need it more? How does leaving that corporate wealth in private hands help the average person? This is the simplistic way that Sanders wants you to think about the situation. But this is not a true reflection of the situation at all.

In pre-capitalist feudal times, wealth was acquired by conquest and subjugation. The Duke in the castle was there because his group was militarily the strongest, having defeated the previous band of marauders, who defeated everybody else in the area. A Duke’s castle might be sacked by the army of another Duke, but the common person’s lot in life would be the same, albeit with a new master.

In this system, nearly all production was for the benefit of the wealthy “strongman.” The tailor-made fine clothes for the Duke. The blacksmith shod the Duke’s horses, the woodworker made the Duke’s furniture, and so on. For everybody else, virtually nothing was produced at all apart from meager subsistence. It was not possible to “become” wealthy in such a society—there was no peaceful process by which it could occur.

Sanders and many others would like you to view the world in that paradigm. But that is not how a market economy works.

Sure, the rich still appreciate their custom furniture and fine clothes—and you can make a modest living as a craftsman or tailor. But you don’t become a billionaire yourself from those activities. You become a billionaire in a market economy by producing products for millions, or even billions of people.

The people who started Amazon, Google, Walmart, Apple, Microsoft, and Disney got rich through their unparalleled level of service to the masses. They were “voted rich” through the voluntary choices of millions of people.

Amazon is one of the most amazing engines of poverty reduction and enhancement of living standards the world has ever seen. They literally make the working poor less poor, by offering them goods and services they like at prices they can afford. (Not to mention the opportunities Amazon creates by empowering and encouraging entrepreneurs to start new side businesses at very low start-up cost.)

The Problem with a Wealth Tax

I’m sure Bezos has some nice houses (as does Sanders) and other luxury items that would make our minds boggle. But not $109 billion worth. Most of the wealth of people like Bezos consists of shares in the companies they started, which were initially worth zero. It is other people’s recent valuations of those shares on the stock exchange that we are quoting. The figures come from multiplying the last traded parcel of shares by the total number of shares owned – not from any realistic offer to purchase the whole company.

Somebody like Bezos does not normally keep a spare $8 billion under the mattress, just in case Uncle Sam asks for it. In order to raise that money, he would have to sell down some of the stock of his company, and probably much more than $8 billion worth at the current valuation. But who would buy them?

When you credibly threaten to confiscate wealth, valuations can plummet. Not to mention the fact that all other billionaires (at least American ones) would be in the same predicament, being forced sellers of large portions of their own stocks.

Perhaps during the initial rounds of the tax, there may be some small investors, small enough to be flying below Sanders’s radar for the time being. But if these shareholders thought they could do a better job running those companies, they could just buy those shares on the open market right now. By not doing so in an un-coerced market, they are indicating that they feel less competent than the current owners.

So over time, it would be unlikely that any new Amazons or Apples would be started, and existing firms would be placed in ever less capable hands, with ever lower valuations as the wealth tax works its way down the line from billionaires to millionaires.

Sanders would either have to tax a vastly diminished pie or ask foreign investors to buy up US firms or, more likely, just confiscate shares directly and nationalize the companies. After a very short time, these companies would end up being majority-owned by the state – a veritable “trillionaire.”

Who’s Best Suited to Run a Business?

But perhaps you agree with Sanders that billionaires should not even exist, so it is still worth it anyway, regardless of how much tax is raised. The key question is, would the state do a better job running those companies than the entrepreneurs who started them or the investors who may have voluntarily bought them?

This is an important question, since these companies were started to provide goods and services to the masses, so it is the poor and middle class who will suffer if they do not operate efficiently. But now, instead of being run by competent, productive, future-oriented billionaires, these companies would be managed by an incompetent, non-productive, ultra-short-term-oriented trillionaire institution.

A billionaire businessperson could, if they wanted to, spend their fortune building statues of themselves. But that would only be a drain on the wealth they had acquired through previous rounds of serving customers. They would quickly find that it does not generate new income, and would promptly stop, choosing instead to invest in ways that expand the business by serving even more people. There is an effective feedback loop to weed out unproductive choices and reward productive ones.

But the state, for its entire existence, has had the privilege of being able to just confiscate any resources it wants and order them to be used in any way its rulers direct. It can choose to build statues, pyramids, or whatever it wants, whether or not it serves real consumer needs. Neither does it have to worry about competition from new entrants doing a better job; it can just ban them. Since nobody gets to choose whether to commit the resources or buy the finished goods, there is no way of knowing whether those resources were spent wisely or poorly.

This does not mean people in government don’t make any good decisions. They will stumble upon some good ones over time. But the people involved do not bear any direct consequences for their bad decisions, and neither are they directly rewarded for their good decisions. They have less effective mechanisms for weeding out the bad decisions and doubling down on the good ones. There is more incentive for managers and employees to make their own job more comfortable and less demanding, and there is less consequence for leaving customers twisting in the wind.

In short, a wealth tax means state-owned enterprises, and a state-owned enterprise can get away with being unresponsive, self-absorbed and lazy.

If you dislike productive billionaires, you ought to be 1,000 times more suspect of confiscatory trillionaires.

October 6, 2019. Tags: , , , , , . Bernie Sanders, Communism, Economics. Leave a comment.

Bernie Sanders wants to do the same things to the U.S. that Hugo Chavez and Nicolas Maduro did to Venezuela

Bernie Sanders has described his proposals for the Green New Deal on his website. (Original, archive.)

And here is a link to a blog post that I wrote about the things that Hugo Chavez and Nicolas Maduro did in Venezuela. It includes links to verify each and every one of my claims.

The two things are very similar in many ways.

Both Chavez’s and Sander’s plans call for massive government control of the agricultural, energy, transportation, manufacturing, construction, and steel industries.

Both plans call for replacing the free market with government decision making.

In the U.S., lots of people on the political left praised Hugo Chavez’s actions in Venezuela. In addition to the many college professors and social justice warriors who praised Chavez, Chavez also received praise from Sean Penn, Oliver Stone, Naomi Campbell, Michael Moore, Don King, Noam Chomsky, and Danny Glover.

The things detailed in Sanders’s plan sound a lot like the things that Chavez was talking about when he started implementing his policies. Before Chavez died, he personally chose Nicolas Maduro to be his successor. Since Chavez died in 2013, Maduro has been continuing Chavez’s policies.

The results of these policies in Venezuela have been horribly disastrous.

For example, in May 2017, the Washington Post reported:

In a recent survey of 6,500 Venezuelan families by the country’s leading universities, three-quarters of adults said they lost weight in 2016 — an average of 19 pounds… a level of hunger almost unheard-of outside war zones or areas ravaged by hurricane, drought or plague.

Then in February 2018, Reuters reported:

Venezuelans reported losing on average 11 kilograms (24 lbs) in body weight last year… according to a new university study…

That’s 43 pounds in two years.

You can read all about how this came to be in my blog post.

And then you can read about Sander’s proposals in his very long and detailed article on his website. (Original, archive.)

Just as huge numbers of progressives and other left wingers in the U.S. had praised Chavez’s policies, a lot of these same people are now praising Sanders’s proposals.

Both Chavez’s and Sander’s policies have massive government takeovers of the agricultural, energy, transportation, manufacturing, construction, and steel industries. Both plans involve replacing the free market with government control.

What makes Sanders think that the results of his policies would be any different than the results of the policies of Chavez and Maduro?

In fact, Sanders actually said that it was a “good thing” when people have to wait in line for food.

These are Sanders’s exact words:

“It’s funny, sometimes American journalists talk about how bad a country is, cause people are lining up for food. That’s a good thing! In other countries people don’t line up for food: the rich get the food and the poor starve to death.”

You can see and hear Sanders saying those words in this video:

https://www.youtube.com/watch?v=zJBjjP8WSbc

Here’s a photograph from 2014 of people in Venezuela waiting in line for food: (posted here under fair use from http://www.businessinsider.com/long-food-lines-are-in-venezuela-2014-2 )

Sanders also said the following:

“You don’t necessarily need a choice of 23 underarm spray deodorants or of 18 different pairs of sneakers when children are hungry in this country.”

Well, as it turns out, the policies of Chavez and Maduro have caused a shortage of both deodorant and shoes in Venezuela.

Sanders has repeatedly criticized the existence of “millionaires and billionaires.” (Although he stopped doing so after the New York Times reported that he was one of them.)

Sanders defended his own millionaire status by saying the following:

“I wrote a best-selling book. If you write a best-selling book, you can be a millionaire, too.”

I agree with Sanders.

But here’s the difference between what I believe and what Sanders believes: I believe that it’s a good thing when any person becomes a millionaire or billionaire by providing their customers with the goods and services that their customers choose to buy. By comparison, the only person whose millionaire or billionaire status Sanders has ever defended is his own.

Chavez and Maduro managed to scare many of the millionaires and billionaires, as well as their capital, investment, skills, innovation, and jobs, out of Venezuela. And when Chavez and Maduro scared away those millionaires and billionaires, they also scared away the production of the goods and services that those millionaires and billionaires had been engaged in.

Sanders wants to “break up big agribusinesses” and encourage “urban, rural, and suburban Americans” to “transform their lawns into food-producing … spaces.”

Chavez seized more than 10 million acres of farmland from private owners, and now Maduro is encouraging everyone to grow their own food.

The industrial revolution was powered by fossil fuels. Before the industrial revolution, 90% of people in the U.S. were farmers. Today, with the use of fossil fuels as both fertilizer and fuel, it only takes 2% of the U.S. population to feed the entire country. Truck drivers whose trucks are powered by fossil fuels then transport that food to the other 98% of the population.

Chavez reversed that trend in Venezuela, and now Sanders wants to do the same thing in the U.S. Just as the Venezuelan government took over big agribusiness and is now encouraging everyone to grow their own food, Sanders wants to do the same thing in the U.S.

Sanders wants to replace private automobile ownership with mass transit, even in “rural communities.” While I myself think that mass transit in densely populated cities is a great thing, I also understand that it’s not practical in “rural communities” with much lower population densities.

Chavez and Maduro caused sales of new cars to fall by 99.4%.

Sanders said:

“I favor the public ownership of utilities, banks and major industries.”

CNN reported that Sanders was in favor of nationalizing

“the energy industry, public ownership of banks, telephone, electric, and drug companies and of the major means of production such as factories and capital”

Chavez nationalized all of those things, and it destroyed each and every one of them. Venezuela now has long term, chronic shortages of pretty much everything.

In 2011, Sanders published the following on his official U.S. Senate website: (Original, archive.)

“These days, the American dream is more apt to be realized in South America, in places such as Ecuador, Venezuela and Argentina”

Of course, Sanders didn’t explain why so many Venezuelans have fled the country and relocated in the U.S.

Sanders also didn’t explain why no one in the U.S. is moving to Venezuela for these so-called better opportunities.

Sanders wants to get rid of fossil fuels.

Chavez and Maduro waged war against the oil industry, and now Venezuela has frequent blackouts.

After Chavez took over the country’s oil industry, he did such a terrible job of running it that he actually managed to create a shortage of gasoline in a country that has some of the world’s biggest oil reserves.

And that reminds me of this quote from Milton Friedman:

“If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.”

So, to summarize:

1) Sanders said that it’s a “good thing” when people have to wait in line for food.

2) Sanders said that people have too many choices when it comes to deodorant and shoes.

3) Sanders hates millionaires and billionaires (not withstanding the singular exception of himself).

4) Sanders wants to replace the free market with government control of the agricultural, energy, transportation, manufacturing, construction, and steel industries.

5) Sanders wants to replace large scale, industrial farms with urban gardens where everyone grows their own food.

6) Sanders wants to reduce private ownership of automobiles, even in rural areas with low population densities, where mass transit is not practical.

7) Sanders wants to nationalize major industries.

8) After Chavez had already adopted many of his own destructive policies, Sanders specifically cited Venezuela as being better than the U.S.

The more and more that Sander’s proposals get examined, the more and more it becomes apparent that they resemble those of Chavez and Maduro.

Bernie Sanders wants to do the same things to the U.S. that Hugo Chavez and Nicolas Maduro did to Venezuela.

September 3, 2019. Tags: , , , . Bernie Sanders, Economics, Venezuela. Leave a comment.

Bernie Sanders said it’s a “good thing” when people have to wait in line for food. Meanwhile, in the real world, this is what it’s actually like to wait in line for food in Venezuela.

Bernie Sanders said that it’s a “good thing” when people have to wait in line for food.

These are his exact words:

“It’s funny, sometimes American journalists talk about how bad a country is, cause people are lining up for food. That’s a good thing! In other countries people don’t line up for food: the rich get the food and the poor starve to death.”

You can see him saying it in this video:

https://www.youtube.com/watch?v=zJBjjP8WSbc

Meanwhile, in the real world, this is what it’s actually like to wait in line for food:

(more…)

August 8, 2019. Tags: , , , , , , , , , , , . Bernie Sanders, Communism, Economics, Social justice warriors, Venezuela. Leave a comment.

Hypocrite Bernie Sanders says it’s “not acceptable” that some of his employees have complained about getting paid less than $15 an hour

Bernie Sanders has repeatedly said that he wants the minimum wage to be raised to $15 an hour.

However, he pays some of his own employees only $13 an hour.

And he said it’s “not acceptable” that some of his employees have complained about this.

These are Sanders’s exact words:

“It does bother me that people are going outside of the process and going to the media. That is really not acceptable. It is really not what labor negotiations are about, and it’s improper.”

This makes Sanders a hypocrite in two ways.

First of all, he doesn’t pay his own workers the $15 minimum wage that he wants all other employers to pay.

And secondly, he’s against his own employees complaining about their pay, even though he has always supported free speech for everyone else’s employees who complain about their pay.

Of course this is also the same Bernie Sanders who repeatedly criticized “millionaires and billionaires,” but then hypocritically defended his own membership in that very same group after the media reported that he was one of them.

July 20, 2019. Tags: , , , , , , . Bernie Sanders, Economics. Leave a comment.

In order for the women’s soccer team to be paid as much as the men’s team, at least one of these two things should have to happen

In order for the women’s soccer team to be paid as much as the men’s team, at least one of these two things should have to happen:

1) The women’s games generate as much advertising revenue as the men’s games.

2) The women’s team plays 25 games against the men’s team, and the women’s team wins at least 40% of those games.

July 9, 2019. Tags: , , , , , , , , , , , , , , , , , . Economics, Sexism, Sports. 1 comment.

Attention banks! Do not give a mortgage to Simon Galperin!

A guy named Simon Galperin just wrote this article, which is titled, “I’m a 29-Year-Old With $235k in Student Debt. I’ll Never Pay It Back.”

Galperin’s statement that he will never pay back his student debt is not because of a medical issue that has rendered him unable to work.

Instead, his statement is proof that he is irresponsible, lazy, spoiled, and entitled.

He also says he believes that innocent taxpayers should be forced to pay off his student debt, so that he can then get a mortgage to buy a house.

If Galperin ever does apply for a mortgage to buy a house, I hope that any bank that considers giving him a mortgage will come across this article that he wrote, and realize that he is an absolutely horrible credit risk.

June 17, 2019. Tags: , , , , , , , , , . Economics. 2 comments.

AOC and Bernie Sanders Don’t Understand Math

https://www.youtube.com/watch?v=ajDfQ-hd3pQ

https://medium.com/@SenSanders/senator-bernie-sanders-and-representative-alexandria-ocasio-cortez-s-plan-to-stop-big-banks-and-1817c205587b

Senator Bernie Sanders’ and Representative Alexandria Ocasio-Cortez’s Plan to Stop Big Banks and Payday Lenders from Ripping Off Americans

By Bernie Sanders

May 9, 2019

If you get a credit card from a store like Macy’s, Kohl’s, or Lowe’s, interest rates are even higher. Stores like these are charging customers an average interest rate of more than 27 percent. And many of the stores rely on these high-interest-rate cards for more than a third of their revenue. Incredibly, Macy’s earned almost 40 percent of its revenue from these cards and Kohl’s recently made 35 percent of its total profit from high-interest-rate cards.

What this means is that if you buy a $500 refrigerator from Lowe’s or Home Depot on one of their credit cards, you will likely owe an additional $136 in interest.

June 9, 2019. Tags: , , , , , . Alexandria Ocasio-Cortez, Bernie Sanders, Economics, Politics. Leave a comment.

Trump’s Tariffs Have Already Wiped Out Tax Bill Savings for Average Americans

https://finance.yahoo.com/news/trump-tariffs-wiped-most-families-080000425.html

Trump’s Tariffs Have Already Wiped Out Tax Bill Savings for Average Americans

June 7, 2019

(Bloomberg) — President Donald Trump’s trade wars have already wiped out all but $100 of the average American household’s windfall from Trump’s 2017 tax law. And that’s just the beginning.

That last $100 in tax-cut gains could soon completely disappear — and then some — because of additional tariffs Trump has announced. If the president makes good on his threats to impose levies on virtually all imports from China and Mexico, those middle-earning households could pay nearly $4,000 more.

Subtract the tax cut, and the average household will effectively be paying about $3,000 more in taxes through additional levies on the products they consume.

“It’s giving with one hand and taking with the other,” said Kim Clausing, an economics professor at Reed College in Portland, Oregon, who has written a book promoting free trade.

Here’s how the math works. Middle earners got an average tax cut of $930, according to the Urban-Brookings Tax Policy Center. The tariffs already in effect cost the average household about $831, according to research from the New York Federal Reserve.

China Goods

Add in the additional tariffs on another $300 billion in Chinese goods that Trump proposed in May and that increases the cost for the average family of four to about $2,294 annually, according to research from Tariffs Hurt the Heartland, a coalition of business groups that oppose tariffs.

Trump has also threatened to levy tariffs on all imports from Mexico, starting with a 5% tax beginning as soon as Monday that would increase monthly to 25% by October. If the tariffs reach their highest level, that would increase costs for households by $1,700 annually, according to Gary Hufbauer, a senior fellow at the centrist Peterson Institute for International Economics.

The full force of the Chinese and Mexican tariffs and subsequent retaliation would mean that consumers are paying an additional $3,994 because of tariffs, more than four times the $930 tax cut for middle earners that the Republican Party touts as its signature legislative achievement.

The tariffs are “clearly demolishing” the benefits of the tax cuts for both businesses and consumers, said Daniel Ikenson, who directs trade policy at the libertarian Cato Institute. “Many households and consumers have been spared so far, but the next round of tariffs will be more problematic.”

In the beginning of the trade dispute, Trump and his advisers sought to put tariffs on imports that consumers don’t directly buy, such as steel and aluminum. But as the trade feud with China has escalated, they ran out of non-consumer goods on which to put levies. The most recent round of announced tariffs includes consumer products, such as apparel, sporting goods and kitchen ware.

Trump’s most recent threat on all imports from Mexico would increase prices on cars and auto parts, televisions, phones and air conditioners, as well as produce, such as avocados, citrus and pineapples.

Only the top 5% of earners would continue to see a net tax cut of more than 1%, according to the right-leaning Tax Foundation. Tariffs would also depress wages by about 0.5% and result in the loss of nearly 610,000 full-time jobs, according to the foundation.

That creates political problems for Republicans in Congress who have continued to back Trump even as they disagreed with his trade policies. Republicans have cited the passage of the tax-cut law, low unemployment rates and wage increases as signs that Trump’s policies have buoyed the economy. But there are signs that support is beginning to fracture.

The tax cuts “vaulted America back into the most competitive economy,” said Representative Kevin Brady, a Texas Republican who led the passage of the tax cut legislation in the House. “Higher tariffs and the uncertainty that comes with trade disputes” hurt the economy, he said.

Senate Majority Leader Mitch McConnell urged the administration this week to delay imposing the tariffs until Republicans in Congress could plead their case to Trump. Most Senate Republicans have objected to Trump’s use of tariffs to force tougher border enforcement by Mexico. Lawmakers are weighing moves to block the levies.

“This is a man-made disaster, because Donald Trump is not focused in any way on advancing a well-thought-out doctrine,” said Representative Hakeem Jeffries, a top Democrat from New York. “He seems to be carrying out at times personal vendettas, at other times political objectives and sometimes an effort to distract from the news of the day.”

Little Noticed

The effects of tariffs have yet to become noticeable to average consumers. That could soon change. The tariffs on goods from Mexico are slated to go into effect Monday, barring a last-minute deal between Mexican and U.S. negotiators. The Chinese tariffs hitting consumer goods could go into effect in the coming months.

Negotiators met for a second day Thursday to try to come to some agreement that would avert the tariffs. Mexico pushed for more time, but Vice President Mike Pence said the U.S. plans to impose tariffs on Monday.

“It’s not like all of sudden prices will jump 25%, but they could increase 10% or 11%,” said Brian Yarbrough, a senior equity analyst at Edward Jones, said of tariffs of 25% or more. “At some point, price increases will choke off demand, resulting in fewer sales.”

Republicans are hoping to campaign in 2020 on the message of a strong economy buoyed by their tax reductions and deregulation, which began two years ago. But the fresh sting of tariffs risk erasing any economic goodwill those policies generated.

“For the average household it will be a net loss, no doubt,” the Peterson Institutes’s Hufbauer said. “It will be painful.”

June 7, 2019. Tags: , , , , , , . Donald Trump, Economics. 2 comments.

Venezuela’s Collapse Is the Worst Outside of War in Decades, Economists Say

https://www.nytimes.com/2019/05/17/world/americas/venezuela-economy.html

Venezuela’s Collapse Is the Worst Outside of War in Decades, Economists Say

Butchers have stopped selling meat cuts in favor of offal, fat shavings and cow hooves, the only animal protein many of their customers can afford.

May 17, 2019

MARACAIBO, Venezuela — Zimbabwe’s collapse under Robert Mugabe. The fall of the Soviet Union. Cuba’s disastrous unraveling in the 1990s.

The crumbling of Venezuela’s economy has now outpaced them all.

Venezuela’s fall is the single largest economic collapse outside of war in at least 45 years, economists say.

“It’s really hard to think of a human tragedy of this scale outside civil war,” said Kenneth Rogoff, an economics professor at Harvard University and former chief economist at the International Monetary Fund. “This will be a touchstone of disastrous policies for decades to come.”

To find similar levels of economic devastation, economists at the I.M.F. pointed to countries that were ripped apart by war, like Libya earlier this decade or Lebanon in the 1970s.

But Venezuela, at one point Latin America’s wealthiest country, has not been shattered by armed conflict. Instead, economists say, the poor governance, corruption and misguided policies of President Nicolás Maduro and his predecessor, Hugo Chávez, have fueled runaway inflation, shuttered businesses and brought the country to its knees. And in recent months, the Trump administration has imposed stiff sanctions to try to cripple it further.
(more…)

May 20, 2019. Tags: , , , . Communism, Economics, Venezuela. Leave a comment.

A Simple Plan To Address The ‘Student Loan Crisis’

https://townhall.com/columnists/derekhunter/2019/04/25/a-simple-plan-to-address-the-student-loan-crisis-n2545285

A Simple Plan To Address The ‘Student Loan Crisis’

By Derek Hunter

April 25, 2019

It’s the greatest crisis facing the country today and threatens not only the present, but the future as well. It’s not the national debt, terrorism, nuclear proliferation, climate change, health care, or any of the other issues Democratic candidates for president routinely ramble about, no. This is something far more serious – people making informed, really bad choices. And the Democratic Party is rallying to their defense.

Out of pure self-loathing, I watched most of the 5-hour lovefest on CNN Monday with Democratic candidates for president. One hour each for Amy Klobuchar, Elizabeth Warren, Bernie Sanders, Kamala Harris and Pete Buttigieg. These back-to-back town halls featured pre-selected questions from a screened audience of college students looking to government to solve their problems. Of course, government can’t solve your problems, especially when your biggest problem is looking to government to solve your problems.

Still, it was a look not only into the minds of the candidates, it was a look into the minds of people who, someday, will be in elected office themselves. It was scary.

A day after more than 300 people were killed in a terrorist attack because of their faith, I don’t remember a single question or statement from anyone about it. There were, however, a lot of questions about student loans.

Judging by the amount of coverage student loan debt has gotten this year, you’d think there were loan officers hiding in bushes outside of high schools waiting to jump out and force college bound seniors to sign their lives away to big banks.

That’s not happening, of course, students are signing those documents willingly after actively seeking out loans for college. But you’d never know it by the way the candidates talk about student loans.

The issue isn’t so much an issue as it is an opportunity to pander. Candidates dangle varying versions of loan forgiveness and “free” college to students with more debt than many companies as a way to buy votes. It’s also a way for Democrats to advance an idea that is at the core of progressive politics: no personal responsibility.

So much of what Democrats are pushing this year is designed to insulate people from the bad choices they make – don’t worry about consequences, government is here to “fix” it. It’s the “let mommy kiss your booboo” of 2020.

Nothing captures this attitude like student loan forgiveness. Fully informed people making bad choices to borrow more money than their education will ever be worth, flocking to politicians promising to make it all better.

Rather than stealing from taxpayers to absolve people of their bad decisions, here’s an alternative that will serve the much more important purpose of teaching future generations about responsibility: tell the truth.

One questioner at Monday’s CNN event asked what can be done for her. According to her question, she’d amassed $25,000 in loans for just her freshman year of undergraduate studies at Saint Anselm College, which cost $38,000 per year in 2017. Rather than pander to someone like this girl, all candidates, and all Americans, should ask her why in the hell she chose to attend such an expensive school. Ask what undergraduate degree she thought could justify such a move. These people need to be taught that a degree in interpretive dance or 1940s bisexual polar bear studies might make you super-woke in your Young Socialists of America drum circle, but they aren’t viable for future employment.

Additionally, every student with a complaint about student debt should be asked the following:

1. Why go to an expensive school if you can’t afford it without taking on massive debt?

2. Why would your parents allow you to choose a school if you have to take on upwards of $100,000 in loans?

3. Do you understand the concept of a loan?

Knowing those questions had to have gone through their heads at some point, they should then be asked why they should be absolved of their debts when they willingly and knowingly made bad decisions?

They won’t have an answer, at least not a good one.

Candidates should pat them on the back, tell them they’re sorry but there’s nothing they can do for them. Not everyone is meant to lead a life of example, some people serve as cautionary tales – so let it be with these people.

Future generations can learn from the high self-esteem, snowflake generation whose parents should have but didn’t tell them “no,” so they can avoid their mistakes. Unless you’re going to be roommates with the next Mark Zuckerberg, no undergraduate education is worth $100,000 or more in debt. If you can’t pay for it with savings, scholarships, grants, and some moderate amount of loans, don’t go to that school. There are other options.

There should be no student loan forgiveness. It’ll be a tough lesson for kids to learn, but it’s one they need. Their parents failed them, their guidance counselors failed them, and they failed themselves. Let a group of liberal billionaires step-up, put their money where their mouths are and help, but don’t force an autoworker in Michigan or farmer in Wisconsin who’s helping their kid work their way through a state school or commuter college do it.

Choices have consequences, especially bad ones. At least they should. Government is supposed to protect people’s rights, not from themselves. And certainly not at the expense of everyone else. Let these people serve as an example of what not to do. It won’t help them, but it’ll do wonders for the next generation.

April 25, 2019. Tags: , , , . Economics, Education. 2 comments.

How Wealth Is Created

https://www.youtube.com/watch?v=n6v81VH6k4A

April 22, 2019. Tags: , , , . Economics. Leave a comment.

U.S. Congressional representative Katie Porter (D-California) doesn’t seem to think that children need a father, and doesn’t seem to care about the density restrictions and other anti-development laws that increase the cost of housing in California

U.S. Congressional representative Katie Porter (D-California) recently talked about “Patricia,” one of her “constituents” who lives in Irvine, California.

Here’s a video of part of Porter’s statement, from the Washington Post channel at YouTube:

https://www.youtube.com/watch?v=0QKOLydDfNg

Since Porter said she looked up the salary of Patricia’s job at monster.com, I am guessing that “Patricia” is fictional. Nevertheless, I will go along with this, and offer my comments and analysis.

Patricia works as a bank teller at JPMorgan Chase, and earns $16.50 per hour, which works out to $35,070 per year. Patricia has a six-year old daughter, and the two of them live together in a one-bedroom apartment in Irvine, California. After taxes, Patricia takes home $29,100 per year, which is $2,425 per month.

Porter provided this image of Patricia’s monthly expenses:

These are Patricia’s monthly expenses:

$1,600 rent

$100 utilities

$250 on a 2008 car

$150 gas

$402 USDA “low cost” food for one adult and one child

$40 phone

$450 after school childcare

This leaves Patricia with a monthly budget deficit of $567.

Porter blames this budget deficit on JPMorgan Chase.

Now I’d like to offer my own commentary and opinion on this, in three different categories.

First of all, Porter makes no mention whatsoever of Patricia’s child’s father.

If Patricia was actually married, then her husband could work from home and take care of their child after school, and there would be no need to spend $450 per month on after school child care. Also, her husband’s income from working at home would make it easier to pay for their other expenses.

This refusal by Porter to even so much as mention Patricia’s child’s father is typical of liberals when they talk about single mothers who are struggling to raise their children. I have previously written about liberals’ refusal to mention the fathers of these children here, here, here, here, and here.

Secondly, Porter never mentions how density restrictions and other anti-development laws cause the price of housing in California to be substantially higher than it would otherwise be.

But I will mention it.

Here is a link to an article that was published by the Atlantic in 2007.

When a developer builds housing, there are three separate and distinct costs: the cost of land, the cost of construction, and the cost of getting a building permit (which the article refers to as the “right to build”).

Irvine is in the Los Angeles metropolitan area. According to the Atlantic article, using data from 1999, getting permission for the “right to build” added $303,000 to the cost of a house in Los Angeles in 1999.

Here’s part of the relevant text from the article:

In a 2003 article, Glaeser and Gyourko calculated the two different land values for 26 cities (using data from 1999). They found wide disparities. In Los Angeles, an extra quarter acre cost about $28,000 – the pure price of land. But the cost of empty land isn’t the whole story, or even most of it. A quarter- acre lot minus the cost of the house came out to about $331,000—nearly 12 times as much as the extra quarter acre. The difference between the first and second prices, around $303,000, was what L.A. home buyers paid for local land-use controls in bureaucratic delays, density restrictions, fees, political contributions. That’s the cost of the right to build.

And that right costs much less in Dallas. There, adding an extra quarter acre ran about $2,300—raw land really is much cheaper—and a quarter acre minus the cost of construction was about $59,000. The right to build was nearly a quarter million dollars less than in L.A. Hence the huge difference in housing prices. Land is indeed more expensive in superstar cities. But getting permission to build is way, way more expensive. These cities, says Gyourko, “just control the heck out of land use.”

The same article also includes this chart:

And please remember, this cost for the “right to build” is completely separate from the cost of the land, and the cost of construction.

The cost for the “right to build” is determined entirely, 100% by zoning laws, density restrictions, and other local government policies.

Here’s another example of how hard it is to get a building permit in California:

http://www.aei.org/publication/texas-great-american-job-machine-solely-responsible-1m-net-us-job-increase-since-2007/

January 23, 2015

… there were more permits for single-family homes issued last year through November in just one Texas city – Houston (34,566) – than in the entire state of California (34,035) over the same period.

Let’s put this into perspective.

Houston is 628 square miles.

California is 163,696 square miles.

So even though California is 260 times as big as Houston, Houston actually issued more new building permits for single family homes in 2014 than did the entire state of California.

Just think about that for a minute.

Those numbers show just how incredibly, ridiculously hard California makes it to build new housing.

Anyone who has ever bought or sold anything at eBay understands that, all else being equal, the bigger the supply of something, the lower price, and the lower the supply, the higher the price.

By making it so difficult to get a building permit in California, the government is causing housing to be far, far more expensive than it would otherwise be.

Here is a great article by Thomas Sowell about how the politicians in California have waged war against the construction of new housing.

This video also explains California’s war against the construction of new housing. And please note that it is progressives, social justice warriors, and other left wing activists who are the ones that are most opposed to building this new housing:

https://www.youtube.com/watch?v=ExgxwKnH8y4

California is waging a very strong, major war against the constriction of new housing.

But Porter never mentions any of this.

Third, being a bank teller is an entry level job. It doesn’t require any education beyond high school.

If Patricia wanted to earn more money, she could have gone to college or trade school before having a child.

But Porter never mentions this, either.

April 15, 2019. Tags: , , , , , , , , . Economics. 2 comments.

Hypocrite Bernie Sanders changes his tune on “millionaires and billionaires” after the media reports that he is one of them

I want to start out by saying that I think it’s absolutely wonderful that Bernie Sanders became a millionaire by selling books to customers who wanted to buy them.

I have no problem with the fact that Sanders is a millionaire.

What I do have a problem with is his hypocrisy.

On many, many occasions, Sanders has criticized “millionaires and billionaires.”

This is a link to a video on C-SPAN’s website, which shows Sanders making such a statement. Here are his exact words: (skip to 0:33)

“There is something profoundly wrong, when in recent years, we have seen a proliferation of millionaires and billionaires, at the same time as millions of Americans are working longer hours for lower wages, and we have shamefully the highest rate of childhood poverty of any major country.”

However, now that the media has reported that Sanders himself is a millionaire, he is saying something very different. The New York Times just quoted Sanders as saying:

“I wrote a best-selling book… If you write a best-selling book, you can be a millionaire, too.”

I agree 100% with Sanders’ statement.

If I can just add three more zeros to my own book sales figures, I, too, will become a millionaire.

Sanders’ association of the existence of “millionaires and billionaires” to the fact that there are children living in poverty is not accurate. According to the book The Millionaire Next Door, 80% of U.S. millionaires are first generation rich. They earned that money legally and honestly, by providing labor, goods, and services that people were willing to pay for. That makes everyone better off. It does not cause anyone to live in poverty.

The real reason there are so many children living in poverty in the U.S. has nothing to do with the fact that there are “millionaires and billionaires.” Instead, the high rate of childhood poverty can be attributed almost entirely to the irresponsible behavior of their parents.

Let’s consider two groups of people in the U.S. The first group has a poverty rate of 2%. The second group has a poverty rate of 76%.

The first group consists of people who followed all three of these steps:

1) Finish high school.

2) Get a full-time job.

3) Wait until age 21 and get married before having children.

The second group consists of people who followed zero of those three steps.

Among people who follow all three of these steps, the poverty rate is 2%.

Among people who follow zero of these steps, the poverty rate is 76%.

(My source for that information is this article, which refers to this PDF, and the relevant data is on page 15 of the PDF. The study uses data from the U.S. Census Bureau.)

Wikipedia has published the following chart, which shows the massive increase in the rate of out-of-wedlock births that has taken place in the U.S. since the 1960s. Source: https://en.wikipedia.org/wiki/File:Nonmarital_Birth_Rates_in_the_United_States,_1940-2014.png

According to that chart, since 1960, the percentage of babies born out-of-wedlock in the U.S. has skyrocketed from 5% to 40%.

In the 1960s, the Democrats launched their “War on Poverty,” whereby the government started paying women to have babies out-of-wedlock.

And as anyone who understands economics will tell you, whatever you subsidize, you get more of.

In this video, a happily married woman explains how a government social worker told her that she should get divorced in order to collect more benefits:

https://www.youtube.com/watch?v=oG6JqmdIubA

The liberals who complain about childhood poverty almost never blame it on the high out-of-wedlock birth rate.

Time and time and time and time again, the media publishes articles about childhood poverty, without even mentioning the fathers of these children.

April 10, 2019. Tags: , , , , , , , , . Bernie Sanders, Economics. 1 comment.

Economically illiterate New York Times writer Michelle Goldberg, who supports the Green New Deal, said she didn’t notice when thieves charged more than $11,000 to her credit card

Michelle Goldberg is an opinion writer for the New York Times. She is in favor of Alexandria Ocasio-Cortez’s Green New Deal. In a recent column, Goldberg wrote:

“Warren, of course, will also be good on climate, and she has endorsed the idea of a Green New Deal put forward by Democrats like Representative Alexandria Ocasio-Cortez.”

In the same column, Goldberg displayed her own economic illiteracy when she explained that she never looks over her monthly credit card statement, and that it was only when her husband looked at it that she found out that a corrupt and fraudulent bank had been charging her hundreds of dollars per month, for years, for a total of more than $11,000. She wrote:

“A few years ago, when I was self-employed and had recently had my second child, my husband went combing through my credit card statements, looking for tax deductions that I’d missed. I’m financially disorganized at the best of times, and with a baby and a toddler, I was barely even trying to keep track of my business expenses. So it’s not surprising that I hadn’t noticed the hundreds of dollars of weird recurring bank charges that my husband discovered.”

“It turned out I’d been signed up for a dubious program that purported to protect users’ credit in certain emergency situations. My bank had been accused of fraudulent practices in connection with it and fined $700 million by the Consumer Financial Protection Bureau, the government agency that was Senator Elizabeth Warren’s brainchild. I tried, maddeningly, to seek redress from the bank — cycling through phone trees, screaming at automated operators. No one could tell me how I’d been enrolled in the program, or for how long.”

“Eventually, I turned to the C.F.P.B. itself, filling out a simple form on its website. A few weeks later, I was notified that the bank had been deducting money from my account for years, and I was being refunded more than $11,000. Having financed my own maternity leave, I badly needed the money.”

The fact that Goldberg never looked over her monthly credit card statements, and that she hadn’t noticed this theft and fraud, proves that she is economically illiterate.

And it’s that same economic illiteracy that causes Goldberg to support the Green New Deal.

Even the supporters of the Green New Deal admit that they don’t know where the money to pay for it is going to come from.

In September 2018, CNN published this transcript of a conversation between Ocasio-Cortez and CNN correspondent Jake Tapper, where Ocasio-Cortez repeatedly refused to answer Tapper’s questions about where the funding for the Green New Deal would come from. Here are their exact words:

TAPPER: Your platform has called for various new programs, including Medicare for all, housing as a federal right, a federal jobs guarantee, tuition-free public college, canceling all student loan debt.

According to nonpartisan and left-leaning studies friendly to your cause, including the Center on Budget and Policy Priorities or the Tax Policy Center, the overall price tag is more than $40 trillion in the next decade.

You recently said in an interview that increasing taxes on the very wealthy, plus an increased corporate tax rate, would make $2 trillion over the next 10 years.

So, where is the other $38 trillion going to come from?

OCASIO-CORTEZ: Well, one of the things that we need to realize when we look at something like Medicare for all, Medicare for all would save the American people a very large amount of money.

And what we see as well is that these systems are not just pie in the sky. They are — many of them are accomplished by every modern, civilized democracy in the Western world. The United — the United Kingdom has a form of single-payer health care, Canada, France, Germany.

What we need to realize is that these investments are better and they are good for our future. These are generational investments, so that not just — they’re not short-term Band-Aids, but they are really profound decisions about who we want to be as a nation and as — and how we want to act, as the wealthiest nation in the history of the world.

TAPPER: Right. Now, I get that, but the price tag for everything that you have laid out in your campaign is $40 trillion over the next 10 years.

I understand that Medicare for all would cost more to some wealthier people and to the government and to taxpayers, while also reducing individual health care expenditures.

But I’m talking about the overall package. You say it’s not pie in the sky, but $40 trillion is quite a bit of money. And the taxes that you talked about raising to pay for this, to pay for your agenda, only count for two.

And I — we’re going by left-leaning analysts.

OCASIO-CORTEZ: Right.

Well, when you look again at, again, how our health care works, currently, we pay — much of these costs go into the private sector. So what we see is, for example, a year ago, I was working downtown in a restaurant.

I went around and I asked, how many of you folks have health insurance? Not a single person did, because these — they were paying — they would have had to pay $200 a month for — for a payment for insurance that had an $8,000 deductible.

TAPPER: Yes.

OCASIO-CORTEZ: What these represent are lower costs overall for these programs.

And, additionally, what this is, is a broader agenda. We do know and we acknowledge that there are political realities. They don’t always happen with just the wave of a wand. But we can work to make these things happen.

And, in fact, when we — when you look at the economic activity that it spurs, for example, if you look at my generation, millennials, the amount of economic activity that we do not engage, the fact that we delay purchasing homes, that we don’t participate in the economy and purchasing cars, et cetera, as fully as possible, is a cost.

It is an externality, if you will, of unprecedented — unprecedented amount of student loan debt.

TAPPER: So, I’m assuming I’m not going to get an answer for the other $38 trillion.

So that’s the relevant part of the conversation between Ocasio-Cortez and CNN correspondent Jake Tapper.

You can see their conversation here:

https://www.youtube.com/watch?v=6CWUgPWRhxU

Supporters of the $40 trillion Green New Deal have already said where $2 trillion of its price will come from. But when Tapper repeatedly asked Ocasio-Cortez where the other $38 trillion was gong to come from, she repeatedly refused to answer him.

Perhaps Ocasio-Cortez could charge that $38 trillion to Michelle Goldberg’s credit card.

April 7, 2019. Tags: , , , , , , , , , , . Alexandria Ocasio-Cortez, Economics. Leave a comment.

Where did Alexandria Ocasio-Cortez get her sweet potatoes?

http://tennesseestar.com/2019/02/27/commentary-where-did-alexandria-ocasio-cortez-get-her-sweet-potatoes/

Where did Alexandria Ocasio-Cortez get her sweet potatoes?

by Jeffrey A. Tucker

February 27, 2019

https://www.youtube.com/watch?v=5SUDG7FIFK8

https://www.youtube.com/watch?v=-haN_2oztvw

Alexandria Ocasio-Cortez was trying to explain to me that the world is going to melt, we are all doing to die, and probably we shouldn’t be having any more children, but I was distracted by the dinner she was preparing on camera. She was carefully cutting sweet potatoes before putting them in the oven.

She put salt and pepper on them. Salt was once so rare that it was regarded as money. Ever try to go a day with zero salt? Nothing tastes right. That was the history of humanity for about 150,000 years. Then we figured out how to produce and distribute salt to every table in the world. Now we throw around salt like it is nothing, and even complain that everything is too salty. Nice problem.

Sweet potatoes are not easy to cut, so she was using a large steel knife, made of a substance that only became commercially viable in the late 19th century. It took generations of metallurgists to figure out how to make steel reliably and affordably. Before steel, there were bodies of water you could not cross without a boat because no one knew how to make an iron bridge that wouldn’t sink.

As for the oven in her apartment, it was either gas-powered or electric. In either case, she didn’t have to chop down trees and build a fire, like 99.99 percent of humanity had to until relatively recently. She merely pushed a button and it came on, a luxury experienced by most American households only after World War II. Now we all think it is normal.

I also presume that her house is warm in the dead of winter and that this is due to indoor thermostatically controlled heat. There are still people alive today who regard this invention as the greatest in the whole course of their lives. They no longer had to work two days to heat a house for one day. Again, one only needs to push a button and, like magic, the warmth comes to you.

The more interesting question is where she obtained those sweet potatoes. The store, I know. No one grows sweet potatoes in Washington, D.C. But where did the store get them? For many thousands of years, the sweet potato was trapped in distant places in South America; it somehow made its way on boat travels to the Polynesian islands, and finally landed in Japan by the late 15th century.

Only once boating technology and capital expenditure for exploration grew to reveal the first signs of prosperity for the masses of people did the sweet potato make it to Europe via an expedition led by Christopher Columbus. Finally, it came to the U.S.

But this took many thousands of years of development — capitalistic development — unless you want to see this root vegetable as the ultimate fruit of colonialism and thus to be eschewed by any truly enlightened social justice warrior.

Even early in the 20th century, sweet potatoes were not reliably available for anyone to chop up and bake, especially not in the dead of winter. Today Americans eat sweet potatoes grown mostly in the American South but also imported from China, which today serves 67 percent of the global sweet potato market.

How do we obtain them? They are flown on planes, shipped on gas-powered ocean liners, and brought to the store via shipping trucks that also run on fossil fuels. If you are playing with the idea of abolishing all those things by legislative fiat, as she certainly is, it is not likely that you are going to obtain a sweet potato on the fly.

I admit the following. It drives me crazy to see people so fully enjoying the benefits from private property, trade, technology, and capitalistic endeavor even as they blithely propose to truncate dramatically the very rights that bring them such material joy, without a thought as to how their ideology might dramatically affect the future of mass availability of wealth that these ideologues so casually take for granted.

To me, it’s like watching a person on IV denounce modern medicine — or a person using a smartphone to broadcast to the world an urgent message calling for an end to economic development. It doesn’t refute their point, but the performative contradiction is too acute not to note, at least in passing.

Now to this question about whether there should or should not be a new generation of human beings. After all, she points out, no one can afford them anymore because young people are starting careers tens of thousands of dollars in debt from student loans. She says there is also the moral issue that we need to take care of the kids who are already here rather than having more.

Truth is, she doesn’t really explain well why she is toying with the idea that it is a bad idea that people have kids. Let me suggest that it is possible that she is drifting toward the path of countless environmentalists before her and finally saying outright what many people believe in their hearts: humankind is the enemy. Either we live and nature dies, or nature lives and we die. There must be some dramatic upheaval in the way we structure society to find a new way. It’s the application of the Marxian conflict fable to another area of life.

Maybe.

In any case, those are big thoughts — too big, really, for a delightful cooking session after which a fancy meal beckons. We’ll get back to what AOC calls the “universal sense of urgency” following dessert.

March 4, 2019. Tags: , , , , , , , , , , , . Alexandria Ocasio-Cortez, Economics, Environmentalism, Food. Leave a comment.

Alexandria Ocasio-Cortez is an economic illiterate — and that’s a danger to America

https://www.washingtonpost.com/opinions/alexandria-ocasio-cortez-is-an-economic-illiterate–and-thats-a-danger-to-america/2019/02/21/ee8c58d8-35f1-11e9-af5b-b51b7ff322e9_story.html

Alexandria Ocasio-Cortez is an economic illiterate — and that’s a danger to America

By Marc A. Thiessen

February 21, 2019

The left complains that conservatives are “obsessing” over Alexandria Ocasio-Cortez. Well, there is a reason for that: Ocasio-Cortez is driving the agenda of today’s Democratic Party — and her economic illiteracy is dangerous.

Case in point: Last week, Ocasio-Cortez celebrated the tanking of a deal negotiated by her fellow Democrats in which Amazon promised to build a new headquarters in Long Island City, New York, right next to her congressional district. Amazon’s departure cost the city between 25,000 and 40,000 new jobs. Forget the tech workers whom Amazon would have employed. Gone are all the unionized construction jobs to build the headquarters, as well as thousands of jobs created by all the small businesses — restaurants, bodegas, dry cleaners and food carts — that were preparing to open or expand to serve Amazon employees. They are devastated by Amazon’s withdrawal. (Amazon’s founder and chief executive, Jeffrey P. Bezos, also owns The Post.)

Ocasio-Cortez was not disturbed at all. “We were subsidizing those jobs,” she said. “Frankly, if we were willing to give away $3 billion for this deal, we could invest those $3 billion in our district, ourselves, if we wanted to. We could hire out more teachers. We can fix our subways. We can put a lot of people to work for that amount of money if we wanted to.”

No, you can’t. Ocasio-Cortez does not seem to realize that New York does not have $3 billion in cash sitting around waiting to be spent on her socialist dreams. The subsidies to Amazon were tax incentives, not cash payouts. It is Amazon’s money, which New York agreed to make tax-exempt, so the company would invest it in building its new headquarters, hiring new workers and generating tens of billions in new tax revenue.

As New York Mayor Bill de Blasio explained, the Amazon deal would have produced “$27 billion in new tax revenue to fuel priorities from transit to affordable housing — a nine-fold return on the taxes the city and state were prepared to forgo to win the headquarters.” Unlike Ocasio-Cortez’s imaginary $3 billion slush fund, that is real money that actually could have been used to hire teachers, fix subways and put people to work. With Amazon leaving New York, that $27 billion leaves with it. Genius.

Ocasio-Cortez does not seem to understand that by helping to drive Amazon away, she did not save New York $3 billion; she cost New York $27 billion. There is a difference between having bad ideas and not grasping basic facts. Reasonable people can disagree about whether New York should have offered Amazon $3 billion in tax incentives — or anything at all — to build its headquarters in the city. But that is different from not understanding that New York is not writing a $3 billion check to Amazon.

Sadly, Ocasio-Cortez doesn’t learn from her mistakes. She made the same kind of error in December when she tweeted, “$21 TRILLION of Pentagon financial transactions ‘could not be traced, documented, or explained.’ $21T in Pentagon accounting errors. Medicare for All costs ~$32T. That means 66% of Medicare for All could have been funded already by the Pentagon.” But, as Pentagon spokesman Christopher Sherwood told The Post, “DoD hasn’t received $21 trillion in (nominal) appropriated funding across the entirety of American history.” Once again, Ocasio-Cortez did not grasp that the Pentagon did not have a magic pile of $21 trillion in cash sitting in a vault somewhere.

Her economic illiteracy matters because she is the principal author of the Green New Deal, which has been endorsed by most of the leading Democratic candidates for president. From this unschooled mind has sprung the most ambitious plan for government intervention in the economy since Vladimir Ilyich Lenin’s train pulled into Petrograd’s Finland Station.

If Ocasio-Cortez doesn’t understand how tax subsidies work, how can she be trusted to plan the federal takeover of the health-care, energy and transportation sectors of our economy? Think she and her allies have any idea how to, as her now infamous talking points put it, upgrade or replace “every building in America” . . . or replace “every combustible-engine vehicle” . . . or connect every corner of America with high-speed rail . . . or replace all fossil-fuel energy with alternative energy sources — all in 10 years’ time? Apparently, they think we just have to find all the magic pots of cash the government is hiding.

When this kind of ignorance is driving policymaking in Washington, America is in profound danger. Amazon left New York because Ocasio-Cortez and her fellow democratic socialists created a hostile environment in the city. And if Ocasio-Cortez has her way, Democrats are going to do to the rest of America what they just did to New York.

February 23, 2019. Tags: , , . Alexandria Ocasio-Cortez, Economics. 1 comment.

My newest book is called “Alexandria Ocasio-Cortez Wants to Stop Cows from Farting”

My newest book is called Alexandria Ocasio-Cortez Wants to Stop Cows from Farting.

That title is not a joke. Ocasio-Cortez really does want to stop cows from farting. She said so on her official Congressional website, as well as in a document which she gave to NPR.

This book is not a joke book. Instead, it presents a serious discussion of Ocasio-Cortez’s policy proposals.

In July 2018, DNC Chairman Tom Perez said that Ocasio-Cortez “represents the future of our party.”

This book shows you that future by quoting Ocasio-Cortez in her own words.

The book’s author also presents his own opinions about Ocasio-Cortez’s policy proposals.

Here are the chapter titles to give you an idea of what’s in the book:

Chapter 1: U.S. Population

Chapter 2: Unemployment rate

Chapter 3: Upper middle class

Chapter 4: Cow farts and airplanes

Chapter 5: Unwilling to work

Chapter 6: Private ownership and profits

Chapter 7: Billionaires

Chapter 8: Military budget

Chapter 9: False accusation of catcalling

Chapter 10: False accusation of mansplaining

Chapter 11: Funeral expenses

Chapter 12: Linda Sarsour

Chapter 13: Nuclear power

Chapter 14: Banning reporters

Chapter 15: Judiciary

Chapter 16: House Ehtics rules

Chapter 17: The end of the world

Chapter 18: Raising taxes on the rich

Chapter 19: Uber

Chapter 20: Republicans and typos

You can buy the paperback version at https://www.amazon.com/dp/1796936030

You can buy the amazon kindle version at https://www.amazon.com/dp/B07NRL9ZM8

Here’s the cover:

February 15, 2019. Tags: , , , , . Alexandria Ocasio-Cortez, Books, Economics, Environmentalism. 2 comments.

Tapper to Ocasio-Cortez: “I’m assuming I’m not going to get an answer for the other $38 trillion”

https://www.youtube.com/watch?v=6CWUgPWRhxU

February 9, 2019. Tags: , , , . Alexandria Ocasio-Cortez, Economics. Leave a comment.

I have four questions for Alexandria Ocasio-Cortez, Bernie Sanders, and anyone else who calls themselves a socialist

I’m curious to hear what Alexandria Ocasio-Cortez, Bernie Sanders, and any other self-described socialists think of these four things:

1) After President Reagan cut the top income tax rate, all of the other OECD countries did the same thing. What do you think of that?

2) Sweden abolished its inheritance tax, after a study showed that the tax did not reduce inequality. What do you think of that?

3) This is what happened as a result of France’s wealth tax. What do you think of that?

http://www.washingtonpost.com/wp-dyn/content/article/2006/07/15/AR2006071501010.html

Old Money, New Money Flee France and Its Wealth Tax

July 16, 2006

Eric Pinchet, author of a French tax guide, estimates the wealth tax earns the government about $2.6 billion a year but has cost the country more than $125 billion in capital flight since 1998.

4) The following rich liberals have all used legal tax shelters to legally lower their own taxes. What do you think of that?

Debbie Wasserman Schultz

The Weekly Standard reports:

Disclosure forms reveal that Democratic National Committee chair Debbie Wasserman Schultz, a member of Congress from Florida, previously held funds with investments in Swiss banks, foreign drug companies, and the state bank of India. This revelation comes mere days after the Democratic chair attacked presumptive Republican presidential candidate Mitt Romney for holding money in Swiss bank accounts in the past.

Nancy Pelosi

The Daily Caller reports:

According to Pelosi’s 2011 financial disclosure statement, the Democratic House Minority Leader received between $1 million and $5 million in partnership income from ”Matthews International Capital Management LLC,” a group that emphasizes that it has a “A Singular Focus on Investing in Asia.”A quick trip to the company website reveals a featured post extolling the virtues of outsourcing.

Valerie Jarrett

fireandreamitchell.com reports:

Top Obama adviser and BFF Valerie Jarrett has a line of credit from a Bermuda insurance company valued between $100,000 and a quarter of a million dollars.

Barack Obama

Fox News reports:

President Obama and his wife, Michele, gave a total of $48,000 in tax-free gifts to their daughters, according to tax records made public on Friday.The president and his wife separately gave each daughter a $12,000 gift under a section of the federal tax code that exempts such donations from federal taxes.There is nothing illegal about the president’s taking advantage of this tax shelter, but it does raise eyebrows given that he has lamented the myriad tax exemptions used by the wealthy—“millionaires and billionaires” like himself—to pay less in taxes.

Noam Chomsky

The Hoover Institution reports:

One of the most persistent themes in Noam Chomsky’s work has been class warfare. He has frequently lashed out against the “massive use of tax havens to shift the burden to the general population and away from the rich” and criticized the concentration of wealth in “trusts” by the wealthiest 1 percent. The American tax code is rigged with “complicated devices for ensuring that the poor—like 80 percent of the population—pay off the rich.”

But trusts can’t be all bad. After all, Chomsky, with a net worth north of $2,000,000, decided to create one for himself. A few years back he went to Boston’s venerable white-shoe law firm, Palmer and Dodge, and, with the help of a tax attorney specializing in “income-tax planning,” set up an irrevocable trust to protect his assets from Uncle Sam. He named his tax attorney (every socialist radical needs one!) and a daughter as trustees. To the Diane Chomsky Irrevocable Trust (named for another daughter) he has assigned the copyright of several of his books, including multiple international editions.

Chomsky favors the estate tax and massive income redistribution—just not the redistribution of his income. No reason to let radical politics get in the way of sound estate planning.

When I challenged Chomsky about his trust, he suddenly started to sound very bourgeois: “I don’t apologize for putting aside money for my children and grandchildren,” he wrote in one e-mail. Chomsky offered no explanation for why he condemns others who are equally proud of their provision for their children and who try to protect their assets from Uncle Sam.

John Kerry

The Boston Globe reports:

Documents obtained by the Globe detail John Kerry’s 1983 investment of between $25,000 and $30,000 in offshore companies registered in the Cayman Islands. The document below, signed by Kerry, shows his pledge to purchase 2,470 shares of Peabody Commodities Trading Corp. through Sytel Traders, registered in the Caymans.

Barney Frank

National Review reports:

When Massachusetts cut its top tax rate to 5.3 percent in 2001, it let guilty liberals pay the old 5.85 percent rate if they wished… Pro-tax U.S. Rep. Barney Frank (D., Mass.) spurned the higher rate. “No, I won’t” pay some $800 extra, Frank told Boston radio host Howie Carr in April 2003.

Michael Moore

ihatethemedia.com reports:

Moore’s most recent effort, Capitalism: A Love Story, took aim at businesses that used shelters to avoid paying taxes and took government bailouts during the market crash.

The thing is, Moore used similar tactics, taking advantage of a Michigan tax break to fund the making of his film–which raked in millions, by the way. Michigan taxpayers–already hit hard with the collapsing auto industry–were left holding the funny money bag for that one.

Bill Clinton

USA Today reports:

Former president Bill Clinton once made public a tax return on which he deducted $2 apiece for donated underwear.

February 8, 2019. Tags: , , , , , . Alexandria Ocasio-Cortez, Bernie Sanders, Economics. Leave a comment.

Poll: What do you think of Denmark’s long term welfare policy for able bodied people?

This New York Times article is from six years ago, but I just found out about it.

The article talks about able-bodied people in Denmark who have been on welfare for a very long time.

It says these able bodied adults get more money from welfare than what many full time workers get from their jobs.

Here’s one example from the article:

It began as a stunt intended to prove that hardship and poverty still existed in this small, wealthy country, but it backfired badly. Visit a single mother of two on welfare, a liberal member of Parliament goaded a skeptical political opponent, see for yourself how hard it is.

It turned out, however, that life on welfare was not so hard. The 36-year-old single mother, given the pseudonym “Carina” in the news media, had more money to spend than many of the country’s full-time workers. All told, she was getting about $2,700 a month, and she had been on welfare since she was 16.

Here’s another example from the article:

Robert Nielsen, 45, made headlines last September when he was interviewed on television, admitting that he had basically been on welfare since 2001.

Mr. Nielsen said he was able-bodied but had no intention of taking a demeaning job, like working at a fast-food restaurant. He made do quite well on welfare, he said…

… Mr. Nielsen, called “Lazy Robert” by the news media, seems to be enjoying the attention. He says that he is greeted warmly on the street all the time. “Luckily, I am born and live in Denmark, where the government is willing to support my life,” he said.

So when you hear Bernie Sanders, Elizabeth Warren, Alexandra Ocasio-Cortez, and other American politicians say they want the U.S. to be like Denmark, please ask yourself if the two people cited above by the New York Times are how you would want your own able bodied children to behave when they grow up.

January 29, 2019. Tags: , , , , , , , , , . Bernie Sanders, Economics, Polls. 2 comments.

Elizabeth Warren doesn’t seem to know that France’s wealth tax caused a REDUCTION in tax revenues

This is what the Washington Post wrote about France’s wealth tax:

http://www.washingtonpost.com/wp-dyn/content/article/2006/07/15/AR2006071501010.html

Old Money, New Money Flee France and Its Wealth Tax

July 16, 2006

Eric Pinchet, author of a French tax guide, estimates the wealth tax earns the government about $2.6 billion a year but has cost the country more than $125 billion in capital flight since 1998.

Anyone who looks at the above numbers would know that all of that capital flight means less income tax, less capital gains tax, less sales tax, less social security tax, and less of many other taxes too. Whatever tax revenue France gets from its wealth tax is more than dwarfed by the reductions in other taxes.

And Warren’s proposed wealth tax rate is actually higher than France’s, so its potential for harm is actually bigger as well.

That doesn’t sound like a good idea for anyone who wants to increase the amount of tax revenue that gets collected by the government.

On the other hand, if Warren’s real goal is to appeal to Democratic primary voters who feel envy and jealousy, and who don’t understand math or the concept of capital flight, then her proposal is a brilliant strategy. Her horrible proposal could very well get her elected President in 2020.

January 28, 2019. Tags: , , , , , , , , , , , , , . Economics. Leave a comment.

Alexandria Ocasio-Cortez doesn’t seem to know that there is actually an INVERSE correlation between billionaires and dangerous intestinal parasites

Alexandria Ocasio-Cortez recently said that it was immoral to allow billionaires to exist when there are people who have ringworm.

She later said that she had meant hookworm, not ringworm.

Hookworm is transmitted to people when they walk barefoot in the feces of other people who are infected with hookworm.

And in the real world, there is actually an inverse correlation between the existence of billionaires, and the rate of hookworm infection.

According to wikipedia, this is how to prevent hookworm:

https://en.wikipedia.org/wiki/Hookworm_infection

Hookworm infection

Prevention

The main lines of precaution are those dictated by good hygiene behaviors:

Do not defecate in the open, but rather in toilets.

Do not use untreated human excreta or raw sewage as fertilizer in agriculture.

Do not walk barefoot in known infected areas.

The places with the highest concentrations of billionaires, such as Manhattan, Silicon Valley, and Singapore, have very few or even zero cases of hookworm. (Although I will admit that San Francisco may be an exception to this trend, as an expert on global public health recently stated that the city’s high rate and tolerance of open defecation actually makes the city dirtier than third world countries. San Francisco is run so badly that the government spends $37,000 on each homeless person per year, and yet they still somehow manage to remain homeless. Can you imagine how much housing any city that wasn’t run by idiots could rent or buy for that much money?)

A long time ago, when there were no billionaires anywhere in the world, hookworm was very common all over the world.

Anyone who is truly against hookworm would be in favor of the existence of billionaires, not against it.

And that’s not even taking into account the charitable work of billionaires such as Bill Gates, which has saved huge numbers of lives.

And that also doesn’t take into account all the jobs that these billionaires provide, as well as the goods and services that these billionaires provide. For example, think of LEGO billionaire Kjeld Kirk Kristiansen and IKEA billionaire Ingvar Kamprad. Does anyone seriously want to argue that the world would be better off if the countries of western Europe had not allowed these two people to become billionaires?

January 27, 2019. Tags: , , , , , , , , , , , , . Alexandria Ocasio-Cortez, Animals, Economics, Environmentalism, Health care, Science. Leave a comment.

Student debt forgiveness is a horrible idea

Responsible adults pay off their debts.

If student debt does get forgiven, that will just give colleges one more reason to raise their tuition. Students will then borrow even more money, knowing that they won’t have to pay it back. The more money the government spends on college aid, the more the colleges raise their tuition. College tuition has already risen many times faster than the rate of inflation, and the last thing we need is to make this problem even worse than it already is.

Student debt forgiveness is unfair to the students who already paid off their debt.

Student debt forgiveness is also unfair to students who worked their way through college.

Student debt forgiveness is also unfair to people who never go to college.

January 5, 2019. Tags: , , , . Economics, Education. 1 comment.

San Francisco progressives wage war against women’s right to earn a living

According to this new article from the San Francisco Examiner, the progressives who control San Francisco’s government have ordered strip clubs to treat strippers as employees instead of as independent contractors.

Supporters of this new policy claim that it makes the strippers better off.

However, the strippers themselves say that it has actually made them worse off – so much so, in fact, that many of them have quit their jobs in San Francisco, and sought employment as strippers in other cities that do not have this same policy.

The article cites the following three reasons for how the new policy makes the strippers worse off:

1) The strippers get paid far less. For example, the article states:

A dancer at the Gold Club, who asked to be called Mary, said it had been common for dancers on average to sell around $1,000 in dances a shift and keep $750.

Under the new commission structure at the Gold Club, however, dancers said they keep none of the first $150 they sell in private dances, 40 percent of the next $250 they sell, and 60 percent of sales beyond that.

Some dancers said they must also pay a $100 fee for renting the private room.

Dancers at the Gold Club said they now walk away with only $60 on the first half-hour private dance they sell.

“When I make a customer pay $400 and I see $60 of it, it isn’t computing for me,” Mary said. “We want to do our job, and previously our business was to sell dances. And we still need to make living. But at the same time, where is the incentive?”

2) The strippers no longer get to decide how many days or which days they work each week.

3) When the strippers were independent contractors, they could choose to reject any potential client that they did not want. Now that they are employees, they no longer have this option.

The article also states:

He estimated that 200 dancers have quit their jobs since the change came down at BSC clubs, including Penthouse and Gold Club and said that the change has “dramatically affected the business and the profitability,” costing the clubs “several million dollars” a year.

and

The drastic pay cuts and availability of cheap flights have pushed some dancers to seek work outside of San Francisco, traveling as far as Las Vegas and Reno one or two nights a week while continuing to live in The City.

So there you have it. The elitist progressives, who think they know what’s best for everyone, claim that this new policy makes the strippers better off. However, the strippers themselves claim that this new policy makes them worse off.

 

http://www.sfexaminer.com/208300-2/

New rules for contractors have unexpected consequences for The City’s strip clubs

January 2, 2019

As some 30 dancers were handed the first employee paychecks ever issued to them by the Penthouse Club one evening in early November, a wave of panic swept the popular North Beach strip club.

“I opened mine in the locker room, and I was shocked,” said a former Penthouse dancer who asked to be identified as Jane. “All the other girls were also freaking out. Me and my friends decided right then that we were done. That was the final straw.”

Historically classified as independent contractors, the dancers were used to walking out of the club’s doors with cash each night — often hundreds of dollars — after their shifts ended. That changed suddenly when clubs across The City began enforcing a California Supreme Court ruling from April in an unrelated industry that set new standards for determining whether or not workers should be classified as employees.

The decision has shaken up the gig economy, but is also having an effect in unexpected places, such as in the hair salons and the adult entertainment industry, where workers have traditionally not been considered employees.

At local clubs, the move to convert dancers to employee status is causing an exodus, with many of them leaving San Francisco establishments.

“This whole business will be completely ruined. The whole point about being a stripper is you go in, get fast cash, no one knows how you’re getting it, it’s not documented and it’s not taken from you,” said a single mother who gave her name as Darla, who also recently cut ties with Penthouse Club. Like other dancers The San Francisco Examiner spoke with for this story, she asked to maintain anonymity for fear of retaliation.

Club owners say the changes are costing them as well.

A sign posted mid-October in the dancers’ dressing room at the Gold Club in the South of Market neighborhood said the club “felt that it was protecting your right and freedom to be an independent contractor.”

“However, as a result of the lawsuits and ongoing demands by the suing dancers and their attorneys, the club is now being compelled by Court order to eliminate the independent contractor option and require all dancers to become the club’s employees,” the sign read.

Axel Sang, marketing director of BSC, confirmed in an email to the Examiner that the dancers were formerly contractors but are now “club employees being paid an hourly wage and commission on dance sales.”

“The BSC-managed clubs now have matching payroll taxes, unemployment compensation, workman’s compensation, Healthy San Francisco costs, Affordable Care Insurance costs, and SF sick leave pay for several hundred new employee entertainers in addition to the hourly wage,” he wrote.

He estimated that 200 dancers have quit their jobs since the change came down at BSC clubs, including Penthouse and Gold Club and said that the change has “dramatically affected the business and the profitability,” costing the clubs “several million dollars” a year.

“A substantial reduction in the number of entertainers performing as well as the substantial increased payroll and other costs makes it very difficult to generate profits,” Sang said.

The California Supreme Court decision pushing the changes in the business came out of a lawsuit brought by two drivers for Dynamex, a same-day delivery and logistics company that converted its drivers to independent contractors in 2004. Under the ruling, workers may now be considered employees if they perform work within the usual course of the company’s business, said David Peer, a labor attorney in Carlsbad who has written about the Dynamex ruling.

“If you are running a strip club, you would think that the dancers are performing work within the usual course,” Peer said. “If the club owners want to play it safe, they should certainly be paying minimum wage and following the wage and hour rules that most organizations follow when they hire an employee.”

Lawsuits alleging improper classification of exotic dancers predate the Dynamex ruling, according to Harold Lichten of Lichten & Liss-Riordan, a Boston law firm representing Uber drivers who claim the rideshare company misclassified them.

“When you improperly characterize someone as an independent contractor you don’t have to pay social security tax, unemployment tax, minimum wage or overtime,” Lichten said, adding that the incentives were “incredibly great” for companies to “misclassify people because they were saving so much money at the workers’ expense.”

Lichten said the Dynamex ruling became leverage in ongoing litigation against Uber, and noted that it should also come as a benefit to the dancers, who now are now eligible for the protections afforded to all employees.

“The concern is that some companies may lower the amount they pay them to make up their losses,” Lichten said. “That would be unfortunate. But on balance, it’s much better to be an employee because you have legal protections.”

However the dancers interviewed by the Examiner said that while they are now entitled to minimum wage, benefits and the option to unionize, the reclassification has done more harm than good.

“Not one of those girls had a check for two weeks over $300. There was a lot of upset. A lot of girls packed up to leave that night. I was one of those girls,” Darla said.

“I can go work at McDonald’s for $15 an hour, and not take off my clothes, and not put up with the crap I put up with as a dancer,” Darla added, noting that all of the Penthouse dancers “have considered leaving.”

The vast majority of the strip clubs in San Francisco — 10 out of 12 — are owned or managed by BSC Management. The only exceptions are the Mitchell Brothers O’Farrell Theatre and The Crazy Horse.

Sang said the company is not paying dancers more than minimum wage because they “are paid commissions on dance sales which in most cases far exceed the hourly wage.”

But dancers said the commission structure for private dances has also been significantly cut.

Policies can vary for each club, but before the reclassification, dancers said if they arrived to their shift early enough they would keep 75 percent of their dance sales — which is where they made the majority of their money.

A dancer at the Gold Club, who asked to be called Mary, said it had been common for dancers on average to sell around $1,000 in dances a shift and keep $750.

Under the new commission structure at the Gold Club, however, dancers said they keep none of the first $150 they sell in private dances, 40 percent of the next $250 they sell, and 60 percent of sales beyond that.

Some dancers said they must also pay a $100 fee for renting the private room.

Dancers at the Gold Club said they now walk away with only $60 on the first half-hour private dance they sell.

“When I make a customer pay $400 and I see $60 of it, it isn’t computing for me,” Mary said. “We want to do our job, and previously our business was to sell dances. And we still need to make living. But at the same time, where is the incentive?”

Some dancers also feared being classified as employees would mean not being able to pick and choose which customers to serve.

Joe Carouba, an owner of BSC, declined to speak with the Examiner for this story because of pending litigation. But in a deposition he gave in October in connection with a lawsuit filed by Olivia Doe, he said he “firmly believed” dancers should be independent contractors so they can assert more control over which customers they will and won’t serve.

“I think they should control their own sexuality, they should control their own bodies,” he said. “The difference there being, of course, if you’re an employee, you don’t have a choice who you perform for, as an independent contractor you get to choose how you perform, whom you perform for, and what level you’re comfortable at.”

Dancers said many of them were poorly informed and caught unaware when the new contracts were rolled out.

Jane said she was one of the first Penthouse dancers to sign the new contract amid confusion, and wasn’t given a copy or time to review it.

At the Gold Club, Mary said management called dancers into the office in the middle of their shifts, still dressed in bikinis and eight-inch heels, and told them to look at a new contract on a computer screen and immediately sign it. Some dancers had been drinking during their shift, she said.

“We were given no opportunity to look at the contracts or have paper copies beforehand,” Mary said. “There’s really been no communication, no transparency.”

Sang denied the allegations, and said cameras were installed to protect the clubs from legal challenges over the new contracts.

“Signs were posted clearly that the areas were under video and audio surveillance. Each contract signing on video and audio clearly shows each entertainer was required to fully read the contract before signing,” Sang wrote in an email. “On camera, each entertainer was clearly given a copy of the contracts that they signed.”

Dancers said morale has plummeted at clubs across The City. Many are unhappy with how management announced and rolled out the change, but fear losing their jobs if they complain.

Because BSC has a virtual monopoly on San Francisco strip clubs, dancers said if they are blacklisted at one club, they are afraid they won’t be able to work anywhere else in The City.

While dancers across the country have sued clubs saying they should have been classified as employees instead of independent contractors, those who spoke with the Examiner said not everyone wants to be an employee. There are advantages to being independent contractors — so long as they are actually treated as contractors.

Mary said being treated as a contractor would mean being able to negotiate dance fees with clients directly rather than have the club set prices, and to pick which dates and times to work. Previously, as contractors, dancers could pick which days to work, but not which hours.

“Contractors should have autonomy,” she said.

An often-touted perk of being an employee is access to benefits, such as health insurance. But to qualify, employees must work enough hours to be considered full-time — which isn’t practical for most people dancing at a strip club. Dancers said even working three days a week is physically exhausting.

“You do what you need to do to maintain your boundary while making sure they have a good time. It takes a lot of emotional labor to do that,” Mary said. “I don’t think people realize that’s the most difficult part of our job. It’s not really talked about in the public perception of stripping.”

The drastic pay cuts and availability of cheap flights have pushed some dancers to seek work outside of San Francisco, traveling as far as Las Vegas and Reno one or two nights a week while continuing to live in The City.

“Girls are scrambling to find a job to fit their lifestyle or even make ends meet,” Jane said.

 

January 2, 2019. Tags: , , , , , , , . Economics, Police state, Politics. 1 comment.

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