Thursday, April 21, 2011

Why you need to read Ann Coulter, Part 1

As my readers probably know, I was born, raised and educated in the former Russia/USSR. I remember growing up in the socialist paradise - and I remember feeling quite disgusted with it.
When I moved to the US, it was only natural that American right-wingers like Rush Limbaugh and Ann Coulter appealed to me. After all, their views of socialism, progressivism and so-called "liberalism" were indistinguishable from mine. I am actually quite impressed that they were able to gain so much insight into communism without actually living under the communist yoke.

And speaking of Ann Coulter - I've read most of her books, and I must confess that her books gave a plethora of new information. For example, I was quite ignorant of Joe McCarthy, and her expose on this American patriot slandered by the left was very valuable. Speaking of slander - how many of you know why one of the left-wing inquisitors started whining about McCarthy's "decency"? What exactly did McCarthy say that the leftist found so disgusting? I have a strong feeling that few of you know the actual story - and I challenge you to answer me without doing the internet search.

While Coulter's history lessons are valuable to anyone who wants to learn the truth, she also teaches her readers how to quickly dissect liberal arguments. As she said in one of her books (I am quoting from the memory): "When a liberal expresses outrage about particular issue, but he is vague on the details, you can be pretty sure that he is lying". Let me show how Ann's maxim can be used to analyze an article by Stephen Ohlemacher, Associated Press. Amazingly, the article starts with a bold-faced lie:
"As millions of procrastinators scramble to meet Monday's tax filing deadline, ponder this: The super rich pay a lot less taxes than they did a couple of decades ago, and nearly half of U.S. households pay no income taxes at all."
What evidence does Stephen provide to prove his assertion that super rich pay less in taxes? Here it is:
"The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992."

Now, remember what Ann Coulter said - if a liberal is vague on details, he is lying. Notice that Stephen undoubtedly took some time to collect the evidence to prove that super rich pay less in taxes. But if you look at the actual statistics that he cites - you will surely discern that none of it proves his point. Yes, indeed, the rick pay taxes at lower rate than before - but does it prove that they pay less in absolute numbers? When my wife showed me this article - I immediately noticed that Stephen was trying to create an impression that statistics confirmed his hypothesis - but then he clearly avoided giving actual numbers on the tax revenue collected from the super rich. If anything, this was proof positive to me that he was lying.

So, as an honest and hard-working man I found the government website that quoted the taxes collected from the super rich - it can be found here, see Table 1 -- Selected Items for Taxpayers with the Top 400 Adjusted Gross Income (AGI), 1992-2007. I put all the numbers in the Excel, and here is the graph that shows the tax rates for the richest 400 households in US from 1992 to 2007.

And indeed, comrade Stephen is correct, "average federal income tax rate was 17 percent, down from 26 percent in 1992". But how about the actual tax revenue? Figure below shows how much federal income tax was collected from the 400 richest households in US.

As the figure shows, the tax revenue collected from the super rich grew from $4,601,023,000 in 1992 to $14,454,803,000 in 2007 in constant 1990 dollars. This is a 300% growth - which clearly shows that Stephen was lying. And let's make the next step, and put the tax rates and tax revenue for the richest 400 households on the same graph:

Evidently, cutting the tax rates for the super rich did not in any way cut the tax collection. One could easily argue that tax cutting increased the revenue - just as the Supply-Side economists predicted.

Of course, Stephen was not the only one who rushed to support Obama's proposal to soak the rich. A reliable Obama's lackey, E.J. Dione Jr. also jumped in the same wagon. In his Washington (com)Post article, he quotes a liberal economist  David Cay Johnston. According to David:

“The effective rate for the top 400 taxpayers has gone from 30 cents on the dollar in 1993 to 22 cents at the end of the Clinton years to 16.6 cents under Bush. So their effective rate has gone down more than 40 percent... The overarching drive right now is to push the burden of government, of taxes, down the income ladder.”
Is this true? Well, indeed the tax rate for the top 400 taxpayers indeed went down (from 22% in 2000 to 17% in 2007). But does it mean that the tax burden shifted down the income ladder? Here is the graph from the exact same government site, which proves that David was lying:

As the readers can see, the top 400 households are now paying a larger portion of the total federal tax revenue. Indeed, that portion went from 1% in 1992, to 1.19% in 2002 - and then skyrocketed to 2% in 2007. Indeed, it's easy to see that lower tax rates on the top 400 households resulted in absolute gain in tax revenue from them - and their relative contribution to the federal tax collection nearly doubled. Does this look in any way similar to what the liberals are proclaiming?

Again, I suggest anyone to remember Ann Coulter's axiom - when liberals are vague in details - that means they are lying. If a liberal article gives you all kind of statistics - but none of it directly proves the assertion - that means the article is lying. The authors went through the pain of looking at all available statistics - and he decided to withold the numbers that prove that he is wrong.

And surely the New York Slimes could not walk away from repeating same numbers, and making same conclusions - without actually bothering to quote the tax revenue from the richest households. Charles Blow, the NYT columnist in an article called "Pirates of Capitol Hill" writes the following: just the period from 1992 to 2007, the tax rate on the top 400 households in America — those with an average annual income of nearly $350 million — fell by more than a third. In fact, the tax rate for these supermillionaires is now less than the tax rate for average Americans.

He concludes the article with a call for murder and mayhem:
More tax cuts would be gluttony in a time of starvation. That is not America. That is a nation about to be plundered, and a people laid to waste.  
For some reason, Charlie neglected to mention that lower tax rates resulted in increased revenue from the top 400 households. In what way is this harmful to the US economy? People earn more money and pay more in taxes - why does that bother Charlie so much? And moreover, and most importantly, why did he "forget" to compare the tax receipts in 1992 and 2007? Is it because it was inconvenient truth?

Last but  not least I must note that an article with similar claims (richest 400 households see a drop in taxes) was published on Alexandria - a blog which I also contribute to. The article quotes same numbers as the previous authors, and just as previous authors it refuses to divulge the dynamics of the actual taxes paid by the rich. The end of the article is rather instructive:

This special treatment of the wealthy might well be worthwhile if it had produced the job creation and growth predicted by supply siders. Instead, we saw years of stagnation with growth largely limited to the financial sector. Now, Ryan wants to reduce top tax rates to 25%, while eliminating loopholes. I say close the loopholes first. Prove that you overcome the political clout of the wealthy to have specific tax laws written, then we can talk about lowering rates, after the debt is reduced.

Of course, had the author took the pain of examining the actual tax revenue, he would have noticed that, just as the supply siders predicted, lowered tax rates on the rich produced more revenue. And once we examine the empirical evidence that shows exactly that - the idea to raise tax rates on the rich can be seen as a naked attempt to punish the rich for their success - even at the cost of lowered revenue. As Alexandria's left-wing blogger Hector infamously explained - he was fine with making the poor people even poorer if only that allowed him to punish the rich. And that's what it all about - American liberals do not mind hurting the poor people in America, they do not care about the negative effects on the tax revenue - their purpose is to hurt the rich. This is pure, unadulterated evil.

"Hatred of a neighbor is to deliberately wish him evil, and is thus a grave sin (CCC 2303 and Galatians 5:19-20).”

Last but not least - don't forget to read Ann Coulter - her books are a valuable tool for American patriots.

Monday, April 11, 2011

They called him "Papik"

My Years As Kaddafi’s Nurse
There is a most peculiar article in the Newsweek - Oksana Balinskayaa describes her career as a Muamar Kaddafi's personal "nurse". According to Oksana, "the job of the nurses was to see that our employer stayed in great shape..." Hm. I bet she tried her best to keep him in shape. Of course, the job had its pluses and minuses: "I had everything I could dream of: a furnished two-bedroom apartment, a driver who appeared whenever I called. But my apartment was bugged, and my personal life was watched closely."

The bloody Libyan dictator was nicknamed "papik" by the cohort of "nurses" - a Russian slang term for "sugar daddy". According to Oksana, her relationship with "papik" was purely platonic - except for the occasional blood-pressure measurements she had to perform on the old dictator. The article is very touching - but in a rather bizarre way - imagine being touched by an old prostitute with syphilis, who is missing half of her front teeth - and who is offering you her professional services. Some of the passages made me laugh - take this one for example:
Gaddafi chose to hire only attractive Ukrainian women, most probably for our looks. He just liked to be surrounded by beautiful things and people. He had first picked me from a line of candidates after shaking my hand and looking me in the eye. Later I learned he made all his decisions about people at the first handshake. He is a great psychologist.
This passage has all the sincerity of a 24 year old prostitute - think about the "Pretty woman". Kaddafi surrounds himself with beautiful people (i.e. Oksana). He chose her (he must be a great psychologist). Self-centered naivety, multiplied by a very low IQ, and intensified by absolutely non-existent distinction between right and wrong. Well, am I talking about this poor Ukrainian girl or the editors of Newsweek? Hm. That's a tough question.
How could they forget what they never knew?
And speaking about American "nurses" to the elderly papiks - there was another amusing article by a liberal journalist promoting left-wing policies. But before I dissect the article - let me introduce its author, Will Hutton. Mr.Hutton is a very distinguished man - a governor of London School of Economics, a visiting professor at the University of Manchester Business School and the University of Bristol, a visiting fellow at Mansfield College Oxford, a trustee of the Scott Trust that owns the Guardian Media Group, rapporteur of the Kok Group and a member of the Design Council's Millennium Commission.
How the hell did he get there - you may ask? How can someone reach this level of power? He must be a distinguished academician, or a very successful businessman? No, not really. Mr.Hutton is neither. According to wikipedia, he got his BSocSc studying Sociology and Economics at the University of Bristol, worked some time as a equity salesman for a stock broker, and then he left for the MBA at INSEAD at Fontainebleau near Paris. But then, this genius joined the government-funded media outlet BBC and worked there as a journalist for 10 years. And this wise career move opened him all the doors he needed to succeed. In short, he is a "nurse" to the British government media papik, the BBC.
Here is how Mr.Hutton describes his life as a journalist for BBC:
We traveled in great style. I accompanied BBC to the United States, Italy, Portugal, and Venezuela, and whenever BBC was in a good mood, it asked us if we had everything we needed. We would get bonuses to go shopping. And -every year BBC gave all its staff gold watches with its picture on them. Just showing that watch in Britain would open any door, solve any problem that we had.

 Ahm - editor's correction - this passage was inadvertently transferred from another article - actually, it was Oksana Balinskayaa's description of her life with Muamar Kaddafi. I sincerely apologize for this error. In fact, I don't think that BBC actually gave Mr.Hutton a watch - but it does seems like the British establishment made sure that Mr.Hutton everything he needed - and that clearly did not include the brains. After all - why does an establishment whore needs brains?

The article that nurse Hutton printed in a left-wing friendly Guardian pushes a set of rather simple ideas - the government should continue to grow, debt is not an issue, bailouts for everyone. What distinguishes this article from some other articles is a rather amazing naivety demonstrated by its author. Here are a few examples with my comments...
He [Lord Keynes] had wanted to destroy the theory propagated by economists and politicians who preached balanced budgets, public austerity, the primacy of national sovereignty and freedoms for finance at home and abroad. Instead, he wanted rules that would acknowledge countries' interdependence and create global institutions and a global currency to give governments room for manoeuvre to act intelligently and creatively to stimulate jobs, trade and growth.
There is a Russian saying that paper can suffer anything - but how could Guardian suffer this?! Firstly - something obvious - a man who writes about rules that "acknowledge countries interdependence" deserves to be publicly whipped for the rape of English language. Government laws do not "acknowledge" anything - and if countries are indeed "interdependent" - that does not have to be acknowledged through government rules - like the laws of the universe do not require the government bureaucracy to write new rules and regulations. Secondly, the budgets must at some point be balanced - one way or another. And thirdly, what's the evidence that "global currency" leads to the governments to "act intelligently and creatively to stimulate jobs, trade and growth"? Indeed, the massive crisis in the EU, the coming bankruptcy of the PIIGS (Portugal, Ireland, Italy, Greece and Spain) can be directly traced to the fact that these countries (and many others in the EU) behaved irresponsibly because they relied on the common currency and the cheap loans that came with it. It would be rather instructive if Mr.Hutton was forced to publicly defend his contention that the euro-currency in any way promoted intelligent acts by the PIIGS. I am willing to agree that PIIGS governments are rather creative in their attempt to make the German workers pay for their failed  policies - but is this something that Mr.Hutton truly wants to see on the global scale?! The Germans are very hard-working people (which is why we call them, "ze Germans"), but I doubt they can save the entire world from bankruptcy - and neither would they be willing to.
And yet, the article becomes unbearably funny when Mr.Hutton criticizes Portugal for doing exactly what it is expected to do in lieu of the common currency:
Across the Atlantic, an army of hedge funds and investment banks forced a lame-duck Portuguese government to turn to the IMF and European Union for a multibillion euro bail out.
And what's most amazing is that the governor of London School of Economics puts Portugal's refusal to cut spending in same line with - you guessed it - the efforts of the Mr.Hutton's great nemesis, the conservatives -  to cut spending. A few weeks ago, the Portuguese Parliament voted against the austerity measures - and as a result their bonds dropped as a rock. Their only other option to prevent bankruptcy was to beg IMF for a handout. Read the entire passage below, and prepare to be startled by Mr.Hutton's inconsistency:
In Washington, a resurgent Republican party took the American government to within two hours of being closed down for lack of politically authorised funds as it battled for swingeing cuts in federal spending. Across the Atlantic, an army of hedge funds and investment banks forced a lame-duck Portuguese government to turn to the IMF and European Union for a multibillion euro bail out. In Britain, George Osborne championed the breathtaking speed of his budget reduction plan by saying he would not play Russian roulette with British economic sovereignty.
But isn't the Portuguese government doing exact opposite of what the Tea Party in US and conservatives in Britain are doing? While conservatives attempt to cut spending in order to prevent the bankruptcy of their nations, Portuguese government refused to do so - and is now forced to beg IMF for a handout. What in the world can Mr.Hutton be thinking? Apparently, it's bad to cut government spending - and it's also wrong to ask IMF for the bailout. What's left to do for a cash-poor government?
But fear not, ladies and gentlemen, Mr.Governor of London School of Economics will propose a clear plan how to get out of debt without cutting the government spending. Here is how he contrasts his thought-through path to nirvana with the primitive ideas of the Tea Party plebs. Prepare to be blown away - this ball is going for the stars.
These are all examples of politicians responding in changed circumstances to new challenges. The question is whether they are right. For example, even US Democrats agree with Tea party activists in the Republican party that if the US repeats what it did in the 2000s, then US public debt will double and become insupportable. The argument is whether the response should be to take an axe to the US federal government or whether the government, despite financial constraints, is part of the solution through its role in triggering more and sustainable growth.
What, that was not enough for you? Here is more:
In Europe, the Portuguese government could have run its affairs with more discipline and investors are wary that they could lose money if there is a default or debt restructuring.

Ah - so, the solution to the debt crisis is to have government a part of the solution through "triggering more and sustainable growth?!" And don't forget about the need for the government "to run its affairs with more discipline". And if that does not give an exhaustive explanation of what Mr.Hutton proposes - then nothing really can. Damn, why haven't we thought of this before? Mr.Hutton's solution reminds me of an old Russian joke...

Once upon there lived mice and everyone harassed them. They went to a wise owl for advise and said: - "Wise Owl, please help us. Everyone harasses us in the forest.What should we do?"
Owl thought about the question and replied:  "You should become hedgehogs. Hedgehogs have needles, no one can harass them."

Mice were very happy, and ran home. But on the way home, one mouse asked: "How do we become hedgehogs?"

And the mice ran back to ask the wise owl how they can turn into hedgehogs.
They came to the wise owl and asked: - "Wise Owl,  how can we turn into hedgehogs?"
And the wise owl replied:  "Guys, don't give me this crap - I solve strategic problems."

But back to our wise M.Hutton....

After Mr.Hutton explains the strategy of dealing with the overwhelming debt which crippled EU and US, he triumphantly proclaims that IMF is a great institution, because it allows Portugal to use it as a papik (without the need for Portugal to check EU's pulse). He also believes that "Government is inevitably part of the solution, not the irredeemable problem." To me, the government has as much claim to be part of the solution, as a man who killed his parents can plead for sympathy because he is an orphan.

Mr.Hutton finishes his article with a call to idiots of the world to unite and fight against common sense:

Economists and business leaders should not let the chancellor get away with Tea party-style statements about Britain risking bankruptcy and having no choices but to suffer. Keynes dedicated his life to challenge that thinking and for some years kept it at bay. The bad news is that it may only be disasters, like the one Keynes lived through, that will make people change their minds. The good news is that there are a lot of a very good and iconoclastic economists – many here – from many countries who want to take up the fight again. It's a race against conventional thinking – and time.

And indeed, the solution to the debt problem that Mr.Hutton proposes is easy to implement - the government should make things better - a simple solution to a very complex problem. Why haven't we thought of that before?! Wise, very wise Mr.Hutton, thank you.

After I re-read Mr.Hutton's article and compared it with the article written by Kaddafi's "nurse" - I came to a conclusion that I was rather unfair to the Ukranian nurse. If anything, she seemed to be far smarter, and more practical than Mr.Hutton. I guess, her experience of serving the despot, as well as the spectacle of his unexpected downfall taught her a number of valuable lessons. I believe it would make perfect sense for the BBC to sponsor Mr.Hutton's internship as a nurse for a Middle-Eastern dictator - which would surely broaden Mr.Hutton's horizons and radically improve his understanding of economics. Hey, it's a win-win situation. Anyone knows of a dictator who wants to have his "pulse checked" by a middle-aged slightly balding distinguished male journalist, who specialises in economics?