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The Morning Grumpy – 4/2/2012

Filed under: Morning Grumpy

All the news and views fit to consume during your morning grumpy.

2nd graders who listened to George W. Bush read "The Pet Goat" on 9/11 will graduate HS in May & be able to enlist to fight in Afghanistan.
Brandon Friedman

1. If you do one thing today and one thing only, make sure you listen to the latest episode of “This American Life”, titled “Take The Money And Run”.

For anyone who has ever heard the term “Washington insider” and felt outside — we are with you. So this week, we go inside the rooms where the deals get made, to the actual moment that the checks change hands — and we ask the people writing and receiving the checks what, exactly, is the money buying?

One of the best exposés of the “pay to play” nature of the U.S. Congress. The prologue to the episode is enough to get your ready for a revolution.

2. Word War 3.0 and the dangers of governmental control of the Internet.

When the Internet was created, decades ago, one thing was inevitable: the war today over how (or whether) to control it, and who should have that power.

The Internet is now approaching a state of crisis on four main fronts.

The first is sovereignty: by definition, a boundary-less system flouts geography and challenges the power of nation-states. The second is piracy and intellectual property: information wants to be free, as the hoary saying goes, but rights-holders want to be paid and protected. The third is privacy: online anonymity allows for creativity and political dissent, but it also gives cover to disruptive and criminal behavior—and much of what Internet users believe they do anonymously online can be tracked and tied to people’s real-world identities. The fourth is security: free access to an open Internet makes users vulnerable to various kinds of hacking, including corporate and government espionage, personal surveillance, the hijacking of Web traffic, and remote manipulation of computer-controlled military and industrial processes.

How this issue is decided will have long lasting repercussions on freedom, commerce, culture, and global communication. The stakes could not possibly be higher. Pay attention, follow along, get involved.

3.  Are baby boomers killing America? I know this article will irritate my Mother

Since the beginning of the Industrial Revolution, human potential has been consistently growing, generating greater material wealth, more education, wider opportunities — a vast and glorious liberation of human potential. In all that time, everyone, even followers of the most corrupt or most evil of ideologies, believed they were working for a better tomorrow. Not now. The angel of progress has suddenly vanished from the scene. Or rather, the angel of progress has been sent away.

David Frum, former George W. Bush speechwriter, had the guts to acknowledge that the Tea Party’s combination of expensive entitlement programs and tax cuts is something entirely different from a traditional political program: “This isn’t conservatism: It’s a going-out-of-business sale for the Baby Boom generation.” The economic motive is growing ever more naked, and has nothing to do with any principle that could be articulated by Goldwater or Reagan, or indeed with any principle at all. The political imperative is to preserve the economic cloak of unreality that the Boomers have wrapped themselves in.

If you have a parent or aunt/uncle who collects a fat government pension, uses Medicare, complains about the lack of COLA increases in Social Security…and votes Republican because of those damn greedy “other people” getting fat on the government teat, this article will resonate for you. For the record, my Mother gets irritated not because she is one of those types of people (she’s a liberal pinko like me), but she hates broad generalizations about her generation. Anyhow, a very interesting read.

4. An epic piece of enterprise journalism by The New York Times. “Who killed the debt deal?” An investigation into how the deal to raise the debt ceiling and to “transform” government spending and tax rates died a slow, painful and public death last summer.

The Republican version of reality goes, briefly, like this: Boehner and Obama shook hands on a far-reaching deal to rewrite the tax code, roll back the cost of entitlements and slash deficits. But then Obama, reacting to pressure from Democrats in Congress, panicked at the last minute and suddenly demanded that Republicans accede to hundreds of billions of dollars in additional tax revenue. A frustrated Boehner no longer believed he could trust the president’s word, and he walked away. Obama moved the goal posts, is the Republican mantra.

In the White House’s telling of the story, Obama and Boehner did indeed settle on a rough framework for a deal, but it was all part of a fluid negotiation, and additional revenue was just one of the options on the table — not a last-minute demand. And while the president stood resolute against pressure from his own party, Boehner crumpled when challenged by the more radical members in his caucus. According to this version, Boehner made up the story about a late-breaking demand as a way of extricating himself from the negotiations, because he realized he couldn’t bring recalcitrant Republicans along. Boehner couldn’t deliver, is what Democrats have repeatedly said.

Whose version is correct? And who actually killed the deal? Awesome work by author Matt Bai. Long read, but worth it.

5. Reality check on what will be the talking point of the week from the Republican reality bubble, that the United States has the highest corporate tax rate in the world.

This isn’t an April Fool’s Day joke; as of April 1, the United States of America will have reached the inauspicious position of having the highest corporate tax rate in the developed world,” said Sen. Orrin Hatch (R-UT) in a statement “I want America to be number one in many things, but having the highest corporate tax rate is definitely not one of them.”

However, that isn’t reality.

U.S. corporate taxes that were actually paid (the effective rate) fell to a 40 year low of 12.1 percent in fiscal year 2011, despite corporate profits rebounding to their pre-Great Recession heights. The U.S. both taxes its corporations less and raises less in revenue from corporate taxes than its foreign competitors:

Why take it from the pinkos at Think Progress, right? How about Warren Buffett?  Is he legit enough for you?

As billionaire investor Warren Buffett has said, “it is a myth” that U.S. corporate taxes are high. “Corporate taxes are not strangling American competitiveness,” Buffett added.

Damn straight, Warren.

Fact Of The Day: J.D. Rockefeller’s Net Worth in 2007 (adjusted for inflation was $663.4 Billion dollars. Bill Gates is worth only 10% of that amount.

Quote Of The Day: “Take the risk of thinking for yourself, much more happiness, truth, beauty, and wisdom will come to you that way.” – Christopher Hitchens

Video Of the Day: “How To Buy A Car Using Game Theory” – Bruce Bueno de Mesquita

Cartoon Of The Day: “Baby Puss” – Tom and Jerry

Song Of The Day: “American Skin (41 Shots)” – Bruce Springsteen, Live in Tampa Bay, FL


Follow me on Twitter: @ChrisSmithAV

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  • Jesse Griffis

    So your mom would be happy to fight for reducing the benefits her generation gets as regressive transfers from the youngest group of working Americans? Yeah, I didn’t think so.

    On the last, “actual” corporate taxes paid are only low because corporate America pays so much to lawyers and accountants to hide and move their assets to places where Uncle Sam can’t get ’em. That’s great – you can claim the tax code as a jobs program! – but in the end, we’d collect more money and distort the economy less if corporate taxes were lowered.

    And I’m not sure I’d use Warren “I hate my life as a rich guy so much but I won’t volunteer to pay more” Buffet as an example of a greedy corporate type who’s seen the light.

    • This may be the most delusional comment I’ve ever seen. If corporate tax rates were lowered, corporations would stop looking for loopholes and tax havens? Really? And it’s always fun to see the “cut taxes and revenue will increase!” canard deployed. Jeebus.

  • kmsmith

    Please don’t purport to know or think you understand what I will or will not fight for. And if your best argument about what Chris said is to trot out the that sad and weary argument (and  completely untrue) that young people are paying for old people to live , peddle it somewhere else.  

  • peteherr

    Whether that is truly “Grumpy’s” mom or not, makes no differnce to me. I will laugh all day that Jesse got put down by Chris’s mom. Completely awesome………and by the way, momma is right, Jess. Those people nearing or in retirement paid for their social security and medicare. It’s not their fault that the keepers of the safe combination used that money for other things. Had that money been invested in an actual trust that paid interest, while there were lots more of them working than retiring, we would have no problems repaying them their benefits with the interest due them.

    • Yes, that is my Mom. She knows how to handle her business online.

      Also, the only reason she was included in the point was that every time I bring up the issue of baby boomers bankrupting America, she gets very annoyed with me. She hates me broad, general assertions and wants me to better define my point.

  • Yes, that is my Mom. She knows how to handle her business online.

    Also, the only reason she was included in the point was that every time I bring up the issue of baby boomers bankrupting America, she gets very annoyed with me. She hates me broad, general assertions and wants me to better define my point.

  • Max Planck

    #4 was particularly pertinent. The place I work out at has screens positioned throughout and one is always tuned to FOX. Thankfully the audio is accessed through headphone connections on the treadmills and stationary bikes. The other day while I was there, FOX was running a piece on “U.S. now has highest corporate tax rate” according to the banner on the bottom of the screen while one of their blonde bimbo talking heads trumpeted the “news” with true Orwellian efficiency. While repulsed at the story, I looked around the room and wondered how many of my fellow exercisers took the bait. Not many, I hope.  

  • Max Planck

    Errata – I meant #5. I’m digitally impaired. Suspect that Hatch was bleating the same myth, too.