The Power to Tax

According to the 2011 "Business Tax Climate" published by the Tax Foundation:

1. Worst state in the union for business taxes: New York.

2. Best state in the union for business taxes: South Dakota.

3. Most improved: Illinois.

4. Heading down fast: New Mexico.

5. At risk: Washington State

Full report here.

Just Don't Say No, Sometimes

Life is too short to say no to every cheeseburger you meet, even if your name is Michelle Obama.

You Know I'm Right

Michelle Caruso-Cabrera, anchor and reporter at CNBC; discusses her new book, You Know I'm Right.

Beware the Intellectuals

So one of the lessons of our century is: Beware the intellectuals. Not merely should they be kept well away from the levers of power, they also should be objects of peculiar suspicion when they seek to offer collective advice. Beware committees, conferences, leagues of intellectuals! For intellectuals, far from being highly individualistic and nonconformist people, are in fact ultra-conformist within the circles formed by those whose approval they seek and value. This is what makes them, en masse, so dangerous, because it enables them to create cultural climates, which themselves often generate irrational, violent and tragic courses of action.

Paul Johnson, "The Heartless Lovers of Humankind"

Their Righteous Cause

"The greatest evils inflicted upon humanity have been the work of those who are so confident of their efforts to do good that they do not hesitate to use the instruments of evil available to them on behalf of their righteous cause."

Vincent Ostrom

Patient Capitalism

Consumer Protection

This is a story about consumer abuse.

A consumer signs a contract he is told will make his life better. He pays $60,000 per year for three years, and ends up unhappy with the results. The promises of the original contract remain unfulfilled. He asks for his money back. He is denied.

The product? A law degree. The promise? A job. The response? You've got to be kidding. We don't give anybody their money back. What do you think this is, a business?

Read more here.

The Biases of Bureaucrats

"[While] there is a lot of interest in the psychology and neuroscience of markets, there is much less in the psychology and neuroscience of government. Slavisa Tasic, of the University of Kiev, wrote a paper recently for the Istituto Bruno Leoni in Italy about this omission. He argues that market participants are not the only ones who make mistakes, yet he notes drily that "in the mainstream economic literature there is a near complete absence of concern that regulatory design might suffer from lack of competence." Public servants are human, too.

Mr. Tasic identifies five mistakes that government regulators often make: action bias, motivated reasoning, the focusing illusion, the affect heuristic and illusions of competence."

Matt Ridley, in the Wall Street Journal

Tea Party to the Rescue

"Maureen "Moe" Tucker, former drummer of the Velvet Underground, has done the best job ever of explaining where the tea party stands and why it stands there. She also suggests the breadth and variety of the movement. In an interview this week in St. Louis's Riverfront Times, Ms. Tucker said she'd never been particularly political but grew alarmed by the direction the country was taking. In the summer of 2009, she went to a tea-party rally in southern Georgia. A chance man-on-the-street interview became a YouTube sensation. No one on the left could believe this intelligent rally-goer was the former drummer of the 1960s breakthrough band; no one on the left understood that an artist could be a tea partier. Because that's so not cool, and the Velvet Underground was cool.

Ms. Tucker, in the interview, ran through the misconceptions people have about tea partiers: "that they're all racists, they're all religious nuts, they're all uninformed, they're all stupid, they want no taxes at all and no regulations whatsoever." These stereotypes, she observed, are encouraged by Democrats to keep their base "on their side." But she is not a stereotype: "Anyone who thinks I'm crazy about Sarah Palin, Bush, etc., has made quite the presumption. I have voted Democrat all my life, until I started listening to what Obama was promising and started wondering how the hell will this utopian dream be paid for?"

Peggy Noonan, in the Wall Street Journal

Here's the video...

The Quotable Bastiat

"I do not address myself to those philosophers who, if not in their own names, at least in the name of humanity, profess to adore poverty.

I speak to those who hold wealth in esteem -- and understand by this word, not the opulence of the few, but the comfort, the well-being, the security, the independence, the instruction, the dignity of all."

Economic Sophisms, Second Series, "Natural History of Spoilation"

Je ne m'adresse pas à ces philosophes qui font profession d'adorer la misère, sinon en leur nom, du moins au nom de l'humanité.

Je parle à quiconque tient la Richesse pour quelque chose. — Entendons par ce mot, non l'opulence de quelques-uns, mais l'aisance, le bien-être, la sécurité, l'indépendance, l'instruction, la dignité de tous.

Sophismes Économiques, Physiologie de la Spoliation

It's Non-Fiction... Unfortunately

In a theater near you on October 15th.

For more information, visit: http://www.iwantyourmoney.net/

A Real Printing Problem

from NPR:
by Chana Joffe-Walt

This is a story about how an economist and his buddies tricked the people of Brazil into saving the country from rampant inflation. They had a crazy, unlikely plan, and it worked.

Twenty years ago, Brazil's inflation rate hit 80 percent per month. At that rate, if eggs cost $1 one day, they'll cost $2 a month later. If it keeps up for a year, they'll cost $1,000.

In practice, this meant stores had to change their prices every day. The guy in the grocery store would walk the aisles putting new price stickers on the food. Shoppers would run ahead of him, so they could buy their food at the previous day’s price.

The problem went back to the 1950s, when the government printed money to build a new capital in Brasilia. By the 1980s, the inflation pattern was in place.

It went something like this:

1. New President comes in with a new plan.
2. President freezes prices and/or bank accounts.
3. President fails.
4. President gets voted out or impeached.
5. Repeat.

The plans succeeded at only one thing: Convincing every Brazilian the government was helpless to control inflation.

There was one more option that no one knew about. It was dreamed up by four guys at the Catholic University in Rio. The only reason they enter the picture now — or ever — is because in 1992, there happened to be a new finance minister who knew nothing about economics. So the minister called Edmar Bacha, the economist who is the hero of our story.
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Listen to the story HERE.