Trumpcare and Trumponomics

For a better analysis than I can write on Trump’s replacement for Obamacare, see Matthew Herper on Forbes.com. His conclusion: Trumpcare is more like a Dem program of vastly expanded central power than Obamacare is at present.

Concerning tax reform, it looks like the Donald is in collusion with the Chamber.  Some of his ideas like lowering corporate tax rate to 15% is welcome and long overdue.  We lose businesses to inversion by having the highest corporate taxes in the world.  He wants to get rid of the Death Tax.  Kudos there.  This is a tax that collects practically no revenue because the rate is so heinous and everybody has a trust.  Good riddance. 

But then Uncle Donald wants to reduce the number of brackets to 4 from 7.  Big whoop.  And by reducing the max from 39.6% to 25%, you know what he will have to do to remain revenue neutral is tax the bejabbers out of the upper middle class.  Then too he promises to take a majority of Americans off of income taxes altogether.  I get nervous at such talk.  This is a Peronist dream.  When a majority of people who pay no tax, show up on election day to dictate what the taxpayers are going to pay for their benefits, this becomes the politics of Argentina.  What I’d like to see is everyone paying tax.  Pay 5 bucks if you can’t afford anything.  Then you will have some skin in the game and can hold your head high, “I pay my taxes just like Trump!”  Both parties have been trying to outbid each other with this tax populism and few realize what disastrous ends result.

The reason few people start small businesses these days, is the tax and regulation burden.  This is no big deal for a major corporation with a room full of accountants.  But for a guy making $10,000 a year, working out of his pickup truck, filing a half-inch thick business and personal tax filing is One Big Deal.  Will reducing the number of brackets lift 20 pages of depreciation schedules from the forms? Will it reduce the 10 pages of forms justifying income streams?  Will it take Congress out of the loophole writing business? Would the IRS not be able to deny tax-free status to conservative groups any longer?  Nope, nope, nope, nope.

Cap Gains goes down to 20% from 24.  Big woop.  Here’s the dirty little secret about cap gains.  Only 14% of long term ownership taxes collected are from stocks traded on Wall Street.  The far larger collection of revenue is from sale of assets like a farmer selling a piece of land or a small business guy selling his shop and tools.  One year in his life, he cashes in and makes good money and that’s the year that IRS takes him to the cleaners with 39% tax rates on “recovered basis” and 24% cap gains on any amount larger than he paid.  Why get into business when Big Government takes most of it in the end?

So in sum, Trump’s tax reform is just rejiggered rates that advantages fat cats and big corporations, but does little to spur entrepreneurism.  The far better program is Rubio’s which eliminates cap gains and allows expensing of equipment.  Ditto Chris Cristie’s proposal which is like this.  Better by far would be a fair tax as espoused by Huck and Carly and possibly Cruz.   

Pontificating

This pope makes me so glad that I am a Protestant.  Whatever happened to John Paul II and his writings about the walk of faith?  This guy talks 3^rd base exclusively.  Let me explain.  Rick Warren took the 5 principles of the Christian life from the Great Commission and Great Commandment of Jesus and arranged them into a symbolic baseball diamond. Pitcher’s Mound is Worship, 1^st is Fellowship, 2^nd is Discipleship, 3^rd is Service, Home plate is Witnessing the Gospel.  All Francis seems to talk about is serving other people. We must welcome more Muslim refugees into our country.  We must welcome Latin Americans (Which he is and this makes his church grow in USA—self-serving motivation?) We must solve income inequality. (Didn’t communism do that by making everyone dirt poor or dead?)

Oh, and global warming. I guess we’ll just have to sort our tin cans and drive little Fiats.  He neglects to talk about the 90,000 Christians who have been massacred in Syria and Iraq, the persecution of Sudan, Nigeria and elsewhere in Africa, or any plea to America that it is the only country that could organize an alliance and do something about such atrocities.  We don’t get a call to get back to the basics of confessional faith in a modern world, and abortion gets a euphemism about the sanctity of life.  Jesus talked about money and what it does to a person’s life more than any other topic in scripture, but Francis never tells the left to start giving. Nor universal fellowship of all Christians, nor any call to repent on a personal level.

No passion.  I listened to part of his sermon to Congress on radio and nearly dozed off. Boehner got all weepy, but it just left me flat.  Shouldn't a guy with a message that brings life to sure death, heaven to sure hell, be a little worked up about it?  That, after all, is why they dubbed it gospel, "Good News!"

Glad there’s more to my faith than global warming and income inequality.    

  

Why the Fed's recent move is so important

Let me give a quick and dirty explanation of Fed policy.  When times are good, the Fed raises interest rates to keep growth and inflation under control.  Because when the economy grows very fast, businesses expand rapidly into new endeavors, bid prices up high, and hire workers.  But this gets to be too much of a good thing when people overbuy(prices bid too high).  Overbuying is the cause of recessions.  If people overbuy houses (2006) the becomes a bubble, the market collapses and a recession results. On the other hand, when the economy is bad, interest rates are lowered to encourage businesses by lowering their borrowing costs.  That’s what Fed does in a recession. 

Now if times are so-so and inflation has met your goals of under 2%, you can use interest rate policy to help the labor market.  If unemployment is high, the Fed will keep interest rates low, reducing business borrowing costs and this frees up money to hire workers. Businesses can hire on the cheap so low interest stimulates the economy without making it overheat and form asset bubbles.  But when unemployment is low, you want to raise interest rates, because keeping interest low for too long a time encourages asset bubbles occur.  That’s where investors see the economy right now. 

Currently, the Fed is in a quandry.  The international economy is poor.  US growth, despite how politicians want to spin it, is crappy. So there are mixed signals and the Fed decided not to raise interest which is now zero percent for interbank loans.

Investors were shocked.  They thought the Fed would raise interest.  Either the Fed is seeing the world differently or something else is going on.  Hence the day after the Fed decision, the stock market was down almost 2% and not just in USA but all over the world.  Investors worry that the world’s economy is crappier than they thought. Moreover, if an asset bubble develops and the interest rate is zero, that interest rate can’t go any lower.  The Fed has no tool to fight recession.

But this is nothing new.  Japan has been in this situation for over 20 years.  Interest is zilch and creates periodic asset bubbles and recessions.  But then recovery growth is paltry and attempts to raise interest cause bad things for their economy.  It’s called a Liquidity Trap. Now think about what this does to average Joe investor who is retired and needs some income to live on.  Bank CDs are just a percent and bonds are 2 or 3. He’s tempted to invest in stocks but he might very well lose a lot of it because of risk. There’s no good solution.

So where does the Liquidity Trap come from?  It’s too much regulation of business or some other control that causes business to play it very safe.  The economy refuses to grow. Central Banks (Fed) respond with low interest but it doesn’t help. Slouching into socialism, the country lapses into a no-growth economy.  Only if the country doing this is undeveloped and can borrow manufacturing and services ideas that have already been developed, can good growth occur. 

What happens if the entire developed world has a liquidity trap?  That’s the question today and the results may not be happy for established nations.  And concerning seniors who need income from investments, it means you have to find another source of cash flow.    

How well do you know the Bible?

Sunday afternoon and it was hot.  Got online.That was an AARP online quiz I decided to take.”How well do you know the Bible?”   American Association of Radical Progressives.  Or since most people around her just join for the AARP for their discounts, maybe I should say, American Association of the Really Parsimonious.  First question was what did Thomas Jefferson do that labeled him an infidel? Infidel!  Has the author of this quiz been hanging around a mullah? Among multiple choices, the closest one was “re-wrote the Bible”.  Correct!--the quiz awarded me. Well actually, TJ didn’t re-write the Bible.  He was the founder of the Virginia Bible Society which had as a goal the sharing of the gospel with the Indians.  But since Bibles were expensive, Jefferson struck upon the notion that he would publish a slimline compilation of Jesus’ quotes from the gospels.  Like if you had a red-letter bible and only copied the red.  Jesus’ quotes could be an assist for others to share the gospel message.  And if a semi-literate Native would order his new Christian life around Jesus’ words, he would have a good start.  Few in Jefferson’s day thought this offensive, but some modernist historians, wishing to discount Christianity, have labeled him a dieist.

Second question was to name the book which removed Jesus’ divinity from the Bible’s story.  4 multiple guesses were available, none of which I’ve read or will ever desire to read (modern books—not in the Bible).  I kept looking for “Quran”, but it wasn’t one of the possible answers.  Have they given this quiz to a literary genius like St. Augustine? No? It turns out the answer was “The Life and Morals of Jesus of Nazareth”. Third question was what percentage of Christians say they attend church almost weekly—43%.  I wonder if any of them are AARP members since this was supposed to be a quiz about how well you know the Bible, not pop religion.  Argus Hamilton often says that Hollywood would love to do another movie based on a scriptural story.  You don’t have to pay a scriptwriter one cent.  Trouble is, they can’t find a Bible anywhere in Hollywood.

Perhaps I can send in a question or two to substitute, so that their quiz really will check your biblical knowledge and give the progressives an education to boot.  Hot issue: gay marriage.  Does Jesus ever say that marriage is to be just one man and one woman?  Where?  The answer is Matthew 19:4ff, and it gets quoted at most weddings “Have you not read that He Who created them from the beginning made them male and female and said, “a man shall leave his father and his mother and cling to his wife and the two shall become one.”  Therefore what God has joined together, let not man put asunder.” (They still have weddings here in flyover country.)

Question 2 hot button issue: abortion.  We humans can’t seem to determine when life begins and can’t agree on the value of a fetus—though Planned Nonparenthood does take a stab at value. Does the Bible say God values an unborn baby and where? Answer: Jeremiah 1:5 (Contrary to popular belief, Jeremiah was not a bullfrog)  God told the prophet, “Before I formed you in the womb, I knew you, and before you were born, I consecrated you.”

Q3.  Does the Bible say anywhere that the government can compromise our beliefs or restrict our witness? Where?  In Acts 4 Peter was on trial with the governing authorities and he addresses them, “Rulers of the people and elders…” They then demanded that Pete “[publicly] speak no more in His (Jesus) name.” Peter replies, ‘for we cannot but speak what we have seen and heard.”  Again in Acts 5:29 he and the apostles tell the authorities, “we ought to obey God rather than man.” 

There you go.  American Association of Religious People.

Kim Davis

They were having a conniption fit on MSNBC over the jailing of Kim Davis, Rowan County, KY County Clerk who refused to sign marriage certificates for homosexuals.  So why don’t any of the pundits say the obvious?  We have a Supreme Court which says that the 14^th amendment of the Constitution authorizes gay marriage. And a Christian who, following Orthodox Christian teaching and her own walk with the Holy Spirit refuses to sign ‘em.  To jail someone and demand they violate their own faith is a violation of the free exercise clause of the 1^st Amendment.  Conflicting laws.  Ergo: the state has to change its way of doing gay marriages. Stop requiring someone who might be a Christian to violate their walk with God. Require state seal, witnessed signatures or some other hocus-pocus instead of a signature by the clerk.

            The learned panel on MSNBC (ahem!) said that she should be punished even worse, given fines she will never be able to repay and thus force her hand to sign her name.  Well, one calmer person said she should just resign.  They were aghast that, as an elected official, she had to be impeached and likely the KY legislature wouldn’t impeach her.  They probably agree with her.  Everybody, and I mean everybody was cock sure that no one on the right would support religious liberty if it was Hindu or Islam.  One pundit got his underwear in a wad because she was claiming free speech had been violated. 

            May I point out that it is not the free speech clause of A1 that is violated.  It is the free exercise of religion clause.  Another way to say it is that “Liberty” was violated.  Liberty was the word coined by John Locke to mean the ability of one to follow the inner voice, the Holy Spirit, the religious conscience (equated with the work of the Holy Spirit by Apostle Paul and the writer of Hebrews).  Liberty is the thing that is guaranteed in the Declaration-- “Life, Liberty, and the Pursuit of Happiness.”  To violate someone’s liberty is to risk violating God’s relationship with one of His children. People will fight to death over loss of Liberty.  “Give me liberty or give me death” was no idle threat. Thus we don’t require Conscientious Objectors or Mennonites to fight in War or demand Muslims serve alcohol or insist that Hindus eat beef.

            Well, I say that people might fight for liberty but I don’t really know, maybe modern people would just wuss out.  As Dietrich Bonhoeffer told some pastors who came to visit him in a Nazi prison, “Why aren’t you here, too?”  I doubt that neither the MSNBC pundits or many moderns read Leviticus 18 or Jesus’s words of Matthew 19, let alone believe them to be the inspired word of God.  

            My prayers are with Kim.  I pray for her strength.  Why, oh why, do new Christians often face a test like this, I don’t understand.  God only knows.  It happened to the Phillippians and Ephesians, the first Japanese Christians, the Yangtze River kids who hardly knew a scripture passage when the communist goons lined them up in ditches and massacred them.

            All I know is that this isn’t the America.  I once knew America. Must be some other tyrannical place.   

 

 

Trying to evaluate Trump

According to a Gallup poll, 75% of people think government is corrupt.  That question has been asked for about 50 years and this is the highest in its history.  82% on a Fox News poll say that the country is dominated by a political class who thinks solely to get re-elected. Now when you see such huge numbers it means that the opinion cuts across R’s, D’s and I’s, young and old, both sexes.  And now we know why Donald Trump is leading and Bernie Sanders is on the rise.  People have had it with professional politicians.

            Me too, but in a different way.  If you sign up to be a campaign manager, you get advise from the state party pros.  They tell you not to put “Republican” on your signs, avoid all issues until at least the end of September, and have your guy talk platitudes until then.  They want a popularity contest, a prom king or queen contest with lots of spending on ads that promote a nebulous brand identity. Ugh!  I understand that a label turns some people off, and if you release a detailed agenda, it only gives the opposition ammunition to pick your ideas apart.  But it is this mush-mouthed lack of forthrightness that drives the people batty.  The political advisors have cooked their own goose. 

            And it goes against what I am looking for.  People look for a lot of things.  I look for “leadership personality”.  In case that seems nebulous, let me explain.  Psychologists define leadership personality as a type.  A leader is the guy who comes into a room of people who are discouraged or argumentative. “Let’s look at the problem a new way,” he/she says, and then launches into a very convincing solution.  A plan lies behind the solution and you wind up thinking, “I want to work with this guy on this project!”   The leader has Vision, Passion, Clever ways to rethink old problems, is Persuasive, thinks how to get from point A to Z and a plan of things that must happen (Strategic thinker), has fun and loves the chase (Contagious Enthusiasm).  I saw several of these types in the candidates at Southern Republican Leadership Conference.  Best of show were Fiorina, Perry, Christie, Cruz and Walker.

            The problem with a pol who won’t tell you much about his plans is like a leader wannabe who has none. A guy who won’t tell you his Vision is likely to wander aimlessly just trying to please people. No Clever approach means he’s stuck in conventional thinking.  No Passion or Persuasion and he puts audiences to sleep. Extremely few folks have all these leadership traits so sometimes you have to compromise for some of them. 

            I get fooled.  I didn’t know George W. Bush was such a leader until 9/11.  That’s because he wasn’t such a great speaker and convincer.  He never reacted passionately to the attacks that he attracted.  But otherwise he was very adequate.  FDR was a perfect communicator, but lacked a plan.  TR and Reagan, whose radio address I rarely missed in the 70s, were classic leaders.  Even though they said RR wasn’t personally brilliant, he enlisted good people around him and used their expertise. TR was inexperienced and made up for it with frenetic effort.

            Comes now Trump.  He’s made a lot of money but I still want to hear his plans.  It is as if he has a standard political advisor who recognizes how to be nebulous in a new Trumpian way.  Lip off and have fun doing it.  That’s great for all the people who tuned in from Dancing with the Stars or CSI or House Hunters, but I still want to see his plans.  His foreign policy seems to be to stick it to China and Mexico.  He wants big tariffs and taxes on investments.  He doesn’t say how he will stop illegals from flying into USA.  He just says stuff like, “I’m going to be the best jobs President ever.” And he attacks all his rivals with impunity.  My questions are manifold.  Will he be able to get their support back having vilified them so badly?  How about 100% of the Republican base? Will he be able to work with Congress?  You can’t bully 535 people who all have large egos.  Does his foreign policy go farther than Mexico and China?  How would a Pres. Trump react to an ISIS that takes over Egypt or an Iran that takes over the Persian Gulf Oil? Does he have any vision for tax reform or is he just going to stick it to investors?  And how does he see the War on Christianity?

            I’m pretty intent on hearing this because USA is in dire shape.  Our economic growth has fallen over the debt cliff (and now joins southern Europe) in going from 65% to 107% of GDP.  For the first time in 400 years America has had more business closings than start-ups in a 5-year period—and foreign economists are stunned that USA has lost its touch in entrepreneurship.  The American Dream to become the kind of person you want is on life-support.  Social Security and Medicare are soon to go broke. We’ve pissed off every ally and we no longer threaten any enemy.  Russia claims the Arctic Sea as theirs.  China has a missle that kills ships  and can’t be shot down because it goes far faster than anything else in the world. Our families are collapsing and inner cities are rioting and our education is 28^th in the OECD.  This is not just another election season.  If we don’t get real leadership, we die.

            Meanwhile the formerly inattentive voters enjoy Trump because he is a big splash and so much unlike the usual politicians. Cool guy, reality TV, thinks the solution is to negotiate everything. But this sucker better get serious and specific fast or I won’t support him, no matter what, in 2016. We are at a crossroads.   

anybody know Den Ali?

Somebody quipped that Obama has a friend Dennis Ali or Den Ali for short.  He decided to name the big mountain for his friend.  I asked if Ali meant the guy was Muslim.  Senator James Lankford was in town Tuesday and he has been reading the Iran Non-treaty.  It says specifically that if anyone attacks Iran, we have to defend them.  So if Israeli intel finds that the Iranians are aiming a missle at them and take it out with F-16s then it is the sworn duty of USA to ‘stand with the Muslims’ as Obama says in his book. The Senator gets to read and see stuff you and I can’t.  I forgot to ask Lankford if Obama’s architectural drawings of his library show a building with minarets.

Oh well, Hillary decides what is classified, Iran decides what is in compliance, and the federal gov’t decides what your religion means. Fortunately the educators can’t decide on history. They asked me if I wanted to join the Shriners and I declined.  They said, “Why? You’d make a great Shriner!”  I don’t wear a fez.  In the 7^th century the city of Fez was besieged and 50,000 Christian inhabitants were massacred. So deep was the blood running in the streets, the gleeful soldiers of The Peaceful Religion dipped their brimless flat-topped caps in the blood to turn them red.  The cap thus became known as a Fez.  I don’t wear such things.  Reminds me of Planned Non-parenthood.  Say, do you know what the difference between a 5 week old unborn baby and PP is?  The baby has a heart.

Let’s see, where was I.  Oh, yeah, Hillary.  Did Dorothy from Kansas throw a bucket of emails on Hillary?  She seems to be melting before our eyes. Her campaign manager explained, “she was a passive recipient of unwitting information that became classified.” So the Passive and Unwitting wants to be Prez? And then all the experts say the classified part happened as the documents are put on a secure government website.  You have to do tricks to remove them and put them on some other document.  Hill laughed and said, “you mean wipe it with a cloth?”  Well, actually, they attached a toilet paper dispenser on the side of that server in the bathroom, I understand. Hillary for Prisondent in 2016.  Somebody called the Democrat bullpen and now all the lefties are warming up.

Trump. When Trump saw Lady Justice with her blindfold and the scales, he said, “Who is that bimbo?”  He kicked Jorge Ramos out of a press conference and 5 minutes later the guy was back.  See, Donald’s deportation orders don’t work any better than Obama’s.  Trump, however, is mad like a lot of people are over robots taking our jobs.  If you fear a robot is taking over your job, here’s how to spot it.  It’s the one who doesn’t pay union dues.  Former Kleagle David Duke has endorsed Trump for Prez.  What? You didn’t know David Duke was still around.  Yeah, he is on a small Louisiana radio station and you have to wear a really pointed hat to get good reception.  You have to watch out for crazy people.  Like on Ramadan, Obama lamented that Americans have a distorted opinion of Muslims.  Wasn’t he the guy who told us they rioted and went wild in Benghazi over a video?

They say someone hacked that Ashley Madison website and published the names of the adulterers.  15,000 addresses match federal workers.  That’s Good!  At least they are showing up for work!  Slick Willie did not deny that he put his credit card on the website but he claims he did not push ‘send’.

I’m votin’ for Carly or Ted.