Archive for the ‘economic development’ Category

Government helping private “enterprise”

September 8th, 2011 by Administrator

This is just a note I write to myself, observing a curiosity about  solar panel maker Solyndra, who filed bankruptcy yesterday and were raided by your FBI today.  The biggest equity investor in the firm is George Kaiser, with “about $337 million”.  Solyndra received a government loan for $527,808,544. OK, so bankruptcy is supposed to mean that loans are repaid to the extent possible, and if there’s anything left it goes to the equity investors.

Not in this case.  Somehow, after the loan was made, documents were revised so that $69 million of Kaiser’s money is first in line for repayment, followed by the government loan. Also, Kaiser was a fundraiser for the current President’s campaign, and visited the White House 16 times since the inauguration.

Lately I kind of figured this is how business is done, it is to be expected that major campaign donors will receive substantial favors from those they helped elect. But at least in this case Reuters has demonstrated some interest, and investigations are giving the appearance of commencing.

Maybe somebody didn’t get their share.

Posted in economic development, Government gone wild, mafia, Uncategorized | No Comments »

Some cool manipulations of tax data

September 5th, 2011 by Administrator

In an ideal world, we wouldn’t need to pay personal income tax, so nobody could compile any data about our individual income (Land value tax is linked to the land, not the owner, so owner identification isn’t needed for tax purposes.) This world being less than ideal right now, it is nice that the Tax Foundation has mined IRS data for these cool tables linking interstate migration of taxpayers and the amount of income reported. We see that, net in 2008, more taxpayers moved to Illinois from  Michigan than from any other state, while the greatest number of net departures was to Texas.  Altho net emigrants to Florida were less than 1/3 those to Texas, their total “adjusted gross income” was greater, presumably affluent retirees.

The Census Bureau is another source of  interstate migration data.  Those reports are simple population numbers with no income data attached, altho I believe the original source data includes income. The Tax Foundation’s data of course can’t recognize people who do not file federal income tax returns.

Tags: ,
Posted in Chicagoland, economic development, human rights, taxes | No Comments »

Avoiding the drag of safety nets

August 26th, 2011 by Administrator

Perry Willis’ recent post  distinguishes two alternative ways in which the state might transfer wealth to ordinary citizens:

  • Dragnets, in which everyone receives the wealth, regardless of need
  • Safety nets, in which only those who are in difficulty receive the wealth.

He characterizes Social Security and Medicare as dragnets, since virtually everyone is covered regardless of need.  Costing 15% of wage and salary for typical workers, these are very expensive programs which might be cheaper if the affluent were excluded from receiving benefits.  He also claims that  “Dragnet programs usually have one other feature — fraud.”

He does not cite any example of a government-funded safety net, tho it seems that Medicaid, which is offered only to those who can meet some need-related criteria, would be a good example. Like any “need-based” government program, it presupposes an apparatus for monitoring everyone’s income from all sources. And does it have fraud?  Take a look.

Perhaps the safety net isn’t much superior than the drag net.  Is there a better approach? Of course. The citizens dividend does not take anything from wages and salaries, does not require an income-monitoring apparatus (altho it might require some kind of citizenship certification), and gives each of us a fair share of what belongs to all of us.

 

 

Tags: ,
Posted in economic development, Georgist/geoist, human rights, poverty | No Comments »

Does Accurate Forecasting Get Attention?

July 22nd, 2011 by Administrator

No, not particularly.  CXO Advisory Group did a little study, comparing the accuracy of forecasts made by a number of investment  “gurus” who they monitor, to the magnitude of google searches.  Based on a couple of different formulations, there was basically no relationship. Of course google searches would be only one measure of fame, and CXO’s way of measuring accuracy isn’t the only reasonable one, but still it is not a surprise.  If I made accurate forecasts, I could prosper with only a few subscribers, who I might charge a high price and ask not to talk about me much.  But if my forecasting record is mediocre, I would want to get as much publicity as possible, because I would need to constantly attract new subscribers.

Tho no surprise, this is not good news for geoists.  At least investment advice can be measured in a more-or-less objective way.  But geoist reforms are in an arena where there are always extraneous factors.  You might get your local tax policy exactly right, for instance, but this could be overwhelmed by an unwise investment in, say, an incinerator.

Tags: ,
Posted in economic development, Government gone wild, investments, taxes | No Comments »

Producing electricity from waste heat

July 10th, 2011 by Administrator

The general concept of using waste heat from one process as an energy source for another is quite old, but this report says that some University of Minnesota researchers have figured out a practical way to generate electricity from it. It involves a new alloy which changes magnetic properties when it’s exposed to heat. Of course I have no idea whether it’s practical, or even whether some patent troll will step in to exact a fee for its use.  It will be interesting to check back in a year or two and see what has become of it.

And let’s remember, it was publicly funded (fortunately completed before the State of Minnesota suspended operations)

Funding for early research on the alloy came from a Multidisciplinary University Research Initiative (MURI) grant from the U.S. Office of Naval Research (involving other universities including the California Institute of Technology, Rutgers University, University of Washington and University of Maryland), and research grants from the U.S. Air Force and the National Science Foundation. The research is also tentatively funded by a small seed grant from the University of Minnesota’s Initiative for Renewable Energy and the Environment.

(No, I don’t know what “tentatively funded” means regarding completed work.)

This is your technology.  Don’t let the big guys take it away from you.Famous photo, unless it has been relocated

Tags: , ,
Posted in dependent scholars, economic development, environment, Intellectual property, which I think is neither, mafia | No Comments »

New horizons in corporate subsidies

May 8th, 2011 by Administrator

I thought it was a scandal when, years ago,  businesses were given subsidies– free money– in exchange for doing the community the favor of employing people.  I thought it was a bigger scandal when retailers were allowed to retain sales taxes, paid by their customers, to pay for capital equipment used in their business. I thought it was about the biggest possible scandal when (more…)

Tags: ,
Posted in Chicagoland, corporate privilege, economic development, mafia, taxes | 1 Comment »

Hong Kong’s “citizens dividend”

May 3rd, 2011 by Administrator

I have previously discussed Hong Kong’s land tenure system, under which the land is publicly owned, but improvement owners have security of tenure in exchange for paying significant land rent.  One result is that most working people don’t have to pay any sales or income taxes.  Another is that land is efficiently used.

But there are a couple of concerns:

  • Since Hong Kong doesn’t collect all the economic rent, speculation can still drive up the cost of housing as well as any activity which uses land (and they all do).
  • Wealthy mainland residents are moving to Hong Kong to take advantage of the increased liberties which HK residents get, further driving up costs for local people.

Now we read that every HK has declared a sort of citizens’ dividend, every permanent resident will get HK$6,000 (US$773, currently).  Bloomberg calls it a “handout,” but I think “share of economic rent” might be more appropriate.  Opponents of the move say it will be inflationary, and certainly it could lead to higher economic rent, with speculation driving land costs even higher. Of course, if people expected the government to collect all the economic rent, speculation would not occur. While the cost of living might still increase, giving an equal dividend to every resident would tend to flatten the income distribution, helping the poor much more than the wealthy.

 

Tags: ,
Posted in economic development, Georgist/geoist, Housing, human rights, land rights, poverty, public policy--nec, speculation | 1 Comment »

Who needs federal transit funding?

April 15th, 2011 by Administrator

Not the Washington DC streetcar project, which at a cost of $1.5 billion is expected to raise land values by $5 to $7 billion.  (This is the increase in value of “existing properties.” Double it to include the value of new construction.) So collecting just 30% of the increase should be sufficient to pay the cost.

A lot of details are missing from the source article, and so far I don’t know how to get the  study which it describes.

Thanks for Alanna Hartzok for the tip.

 

Tags: ,
Posted in economic development, land value, public policy--nec, taxes, transit | No Comments »

How to prevent economic Ebola?

March 27th, 2011 by Administrator

Economic Ebola is “the virus that infects scientists and engineers and causes them to go to Wall Street rather than create something of societal value,” says Paul Kedrosky.  Graduates with quantitative skills are offered salaries up to five times what they could make in productive work, so of course many of them spend their time finding ways to scrape a few million from high-velocity financial markets, rather than designing products or processes that would actually increase society’s satisfaction.

“Let’s save the world by keeping our engineers out of finance,” says Vivek Wadhwa. [Well, they're not really our engineers, they belong to themselves, but we'll skip that for now.]  A fine idea, but how to do it?  One answer might be a financial transaction tax, a tiny levy on each financial trade which could remove the profit from “financial engineering.” It would have no real effect on “long-term” investors who hold a position for more than a day. Seems like a good idea, but of course there will need to be a definition of what is a “financial transaction” for tax purposes, and clever people will find a way to design a transaction which doesn’t meet the criteria.

Maybe a better approach is to eliminate or scale back some of the things that make financial engineering lucrative.  For instance, if a land value tax prevented private collection of land rent, the mortage/financial crisis we’re still in would have been much smaller, or perhaps not possible at all.  We might want to go back to the classical concept of usury, forbidding all transactions where interest is charged for the use of money.  (People can still get compensation for lending money, but it would be as some agreed share of the profits which the investment generates, keeping the lender conceptually closer to the borrower.)

Of course we could start with something simple, like having the government take over insolvent banks, prosecuting and imprisoning criminal executives, letting stockholders, bondholders, and others who have unwisely trusted the bank to absorb the financial loss.  That alone would make financial engineering a lot less appealing.

Vivek Wadhwa
Tags: ,
Posted in business cycle, economic development, Housing, human rights, land value, mafia, public policy--nec, speculation | No Comments »

Collecting the Rent in Hong Kong

March 6th, 2011 by Administrator

Georgists often like to point to Hong Kong as a successful example of funding a community’s needs from economic rent.  The result is a prosperous and (relatively) free city, a magnet for immigrants.  But our information is old, and numerous changes have happened since the transfer of power, from UK to PRC in 1997.

So I was pleased to spend a bit of time this afternoon with a Hong Kong native, who now lives and works in Chicago.  Not familiar at all with Henry George, not even interested in political philosophy as far as I could tell, but able to speak with me about current economic conditions.  If I have any errors below, I trust that someone will correct me. (more…)

Tags: ,
Posted in economic development, Georgist/geoist, Housing, human rights, taxes | No Comments »
« Older Entries
Newer Entries »
'
I support the OCCUPY movement