Because the European Union has agreed to buy 229,000 tonnes of Fiji-grown sugar, at prices above the world market. That might leave Fiji without enough sugar for domestic consumption, so they’re importing 45,000 tonnes from India. I bet those Indian producers would like that premium price. (Unfortunately, the article in source fijilive.com doesn’t specify exactly what the prices are.
Category: Miscellaneous outrages
Update on Consumer Taxes
The Civic Federation has updated their compilation of Chicago consumer taxes, noted last year. This includes the additional 1/4% RTA sales tax effective April 1, but not the Cook County sales tax increase going into effect later.
Unruly Americans
Just finished Woody Holton’s Unruly Americans and the Origin of the Constitution. He’s not the first to point out that the Constitution was established largely to protect the interests of creditors, especially those holding government bonds used to fund the American Rebellion. Bond speculators benefited, as did all creditors, with the states prohibited from issuing paper money, and a federal court system established. Holton gives relatively little attention to land issues, tho he notes that under the Confederation the cost of using the military to secure western land exceeded the revenue from land sales.
The Constitution provided for significant federal military, which not only protected settlers (and their landlords) from Indians but also could aid in putting down slave rebellions. Holton notes that, by making debts more enforceable, the Constitution also made credit more available to Americans. He doesn’t seem to doubt that more debt would be a good thing. He also seems to think that tariffs were an appropriate source for federal revenue, tho acknowledging that excise taxes, such as on whiskey, could lead to difficulties. He approvingly notes that higher tariffs allowed the easing of taxes on land.
Henry George, of course, opposed tariffs as a hindrance to trade, and thought government at all levels would best be funded by a tax on the value of land and other natural resources. And George suggested that a government which does not assist in collection of private debts might discourage excessive lending.
Despite his apparent failure to appreciate such economic fundamentals, Holton’s book is well worth the read for a description of the conditions and methods which brought about the original U S Constitution. (There is a little discussion of the Bill of Rights, which Holton sees as having been promised as one of the compromises necessary to get an elite-favoring constitution ratified, and even less of the subsequent amendments.)
“No country in the world affords such a field for speculations both in paper and land” as the United States, Noah Webster declared in 1791. One of the most successful of the speculators was Abigail Adams. [– page 267]
At least they spelled the name right
I’ve gotten reports from a couple of HGS friends about Jonah Goldberg’s Liberal Fascism, which mentions Henry George a couple of times, not in a favorable light. I rarely find it worthwhile to read Goldberg’s columns in the Tribune, so I would hardly waste time reading his book, but I have been lent a copy of it and found two references to Henry George in the index. Continue reading At least they spelled the name right
Capital Market Dysfunctionality
It’s not the way a Georgist would describe our main economic problems, but it doesn’t fit badly. Paul Woolley, a former (reformed?) investment manager and IMF official, has established his Centre for the Study of Capital Market Dysfunctionality. One way he states the problem:
By most measures finance has become the dominant industry sector accounting, for example, for between 30% and 40% of the aggregate profits of the quoted corporate sector in the US, UK and globally, compared with only around 10% forty years ago
Not only does this mean a lot of money is being paid for a service which isn’t really central to our economy’s purpose, but also that much of the best talent in many fields is diverted to playing financial games rather than useful work.
Of course, in his talk he did not mention land. Since his background is in finance, I guess he looks at the problem as a capital market problem rather than a land speculation problem. As a Georgist, I tend to think that the problem can only be solved by making speculation in natural resources unprofitable. Woolley however will probably show many ways in which the problem can be reduced, or at least postponed. His site shows many papers related to the subject, many worth a look I think. (Of course quite a few of the papers are not available free.)
One reason I am inclined to think this is a serious effort to address the issue is that Woolley is apparently funding the work personally.
We'll pay $141,000/job you "create"
Or, to look at it differently, we’ll give you $353,000 per acre of land you use. That’s what the City of Chicago is giving ” ML Realty Partners LLC” to build a “distribution center” at 401 N. Cicero. Now, all I know about this is what I read in the papers, but according to the Jan 20 Tribune article, $10.6 million in TIF money is going to “create” 75 jobs on 30 acres. This site is practically adjacent to the Green Line Cicero station. Why did nobody want to develop it before? (My guess is that it’s because the landowner was holding out for TIF money.) And how can we justify less than 3 jobs/acre on a transit-served site? This sort of thing might be suitable for Will County, not the west side of Chicago. Is there nothing more productive that can be done with this land?
Cost of living index vs. consumer price index
I should have known about this, but I just discovered that BLS has been publishing a C-CPI-U index. I had seen the term “chained index” around but didn’t realize what it means. This index has a direct month-to-month link to what consumers report that they’re actually buying, rather than using a fixed marketbasket as the conventional CPI’s do. Thus the chained index measures the cost of living– what people actually spend to live– rather than consumer prices. BLS says the chained index is expected to generally be lower than the conventional index, and that has been the experience since it was introduced. However, it seems to me that when the chained index is lower than the conventional index, that means people are finding ways to live cheaper (presumably because their real incomes are declining). If people’s incomes were increasing, relative to the cost of living, wouldn’t the chained index rise faster than the conventional one, as they choose more luxuries?
If I am correct, and the indexes are correct, then real incomes are declining.
BLS explains their chained index here. Actual data seem to appear only in the detailed reports, which are here.
It might not pay to save
That’s the conclusion of a new study by by Laurence J. Kotlikoff and David S. Rapson. Problem is that as you gain more savings you become ineligible for more means-tested assistance programs. Acknowledging that the complexities of the tax code and the programs makes it impossible to perform a complete analysis, they estimate that “A 30-year-old single parent earning $15,000 a year faces an effective marginal tax on saving of 260 percent; for each additional dollar saved, the parent loses $2.60 in additional taxes and foregone government benefits.”
Although the study does not go further than to describe the problem, the next question is what to do. Although one may fiddle with the details, this problem can’t be solved as long as means-tested taxes or subsidies are an important factor in the economy affecting the poor. But clearly a Georgist reform could alleviate it by increasing wages in general, and perhaps solve it completely if resource rents were distributed equally to everyone thru a citizen’s dividend.
The Art of Spectrum Lobbying
Subtitled ” America’s $480 Billion Spectrum Giveaway, How it Happened, and How to Prevent it from Recurring,” this recent report is from the New America Foundation, by J. H. Snider. The actual amount of the giveaway can be subject to some dispute, but it’s clearly a lot of value.
After describing the method and the limitations of the value estimates, the report outlines some specific strategies used by those who hold, or wish to obtain, licenses for use of some portion of the electromagnetic spectrum, at minimal or no cost. Continue reading The Art of Spectrum Lobbying
Homeland Security trumps responsibility
Ever heard of the “Support Anti-Terrorism by Fostering Effective Technologies Act of 2002?” Known as the “SAFETY Act” (Can’t they even keep their acronyms clean?) it limits liability for “almost every conceivable technology” related to homeland security. According to Washington Lawyer Brian E. Finch, even transit [August ’07 Metro Magazine, page 24] and amusement park security guards can be protected from liability under this act.
Feel safer now?