Declare Those Pennies on Your Eyes

IRSWriting about taxes on tax day seems so intellectually lazy. Complaining about our complex, confusing, largely unequal, and definitely incomprehensible tax system simply doubles down on the cliche. After all, American’s don’t agree on much, but I think it’s pretty universal that the systems by which we collect money at the local, state, and federal level have become so bloated and outrageous that the only people satisfied are politicians sucking at the public teat and tax accountants who try to guide the rest of us lost souls through the process. Apologies to tax accountants for tethering you to politicians.

Yet, here I sit the morning after our college-age son had to pay 10% of his pretty meager “income” to Uncle Sam after filing his taxes last night. Both our boys worked hard and earned generous academic scholarships. Instead of forking over tuition dollars, I’ve been able to buy a big screen t.v.  (Who says reading to your kids doesn’t pay off!) Last night, though, as my younger son completed his taxes, we found out that scholarship money above and beyond tuition, fees, and required books counts as taxable income.

Really? Somehow, some hair-brained numbskull in our nation’s capital decided that we really need to go after all that extra money full-time college students are pulling down in their spare time between classes. Can’t let those crazy kids live too high on the hog, after all. Better declare those pennies on your eyes, as George Harrison says.

I’m not trying to express some sort of Unabomber outrage. I’ll willingly admit that I do think people need to pay their fair share in taxes. For my money, our taxes give us access to goods and services that make America great, and we need to share those costs. At the risk of oversimplification, it’s much less expense if we share the cost of military protection among the all 300 million of us than if we all form our own isolated feudal compounds and hire our own protection. Public schools, public roads, consumer protections, and thousands of other “goods” work much better when centralized and when costs are shared. Having healthy debates about what those shared costs should be is worthwhile (and, in theory, something we do every election cycle when we vote for candidates based on their debates about the issues–ha, ha, ha!).

As such, I don’t mind taxes on goods and services, property taxes, or other taxes associated with my choice to consume various goods and services. I think it’s worth reminding everyone that rich and poor, citizen and alien, old and young all pay taxes into the system simply by living and consuming in America. Likewise, I have no issues with federal taxes on income, capital gains, inheritance income, and I fully support requiring that all workers pay into the federal system, even if that amount is as small as 1% of earned income. There’s nothing wrong with ensuring everyone has a little skin in the game. I’ll even admit that I’m a fan of a progressive flat tax system with limited deductions to avoid letting the government pick winners and losers based on who hires the best lobbyists.

Full-time students should have access to that limited set of deductions. My son pays taxes when he buys his books, pays for food, and pays rent. He, like any full-time student moving toward graduation, has limited earning possibilities, though, if he’s going to take enough classes each semester to graduate in four years. Those students who work, like my older son who covered his living expenses as a student, pay taxes every paycheck, but they (usually) get a refund at the end of the year because they don’t earn much.

For students who earn scholarship money above and beyond the cost of tuition, though, the tax bill hits even if the amount above and beyond is the same as their colleagues who work. My son last night paid 10% of his scholarship to Uncle Sam. I’m sure if there’s a CPA reading this blog you can tell me there was IRS Form 666 or something we could have filed, but my son shouldn’t have to do do. Likewise, my older son, once he marks full-time student on his W-2 should be exempt from having money withdrawn. He shouldn’t have to wait for a refund. Let’s put money in the pockets of those citizens who need it the most, especially those who are working to improve their futures (and future earnings).

Like so many other things, we can’t trumpet the value of an education and then actively work to make earning that degree difficult. Students who earn scholarships are being paid to do well in school. That money isn’t income; it’s a long-term investment. After, Uncle Sam’s going to get his eventually, anyway.






Cousin Eddy and the Union Blues


Clark Griswald’s Rant–Christmas Vacation (Click to view)

Around the beginning of December each year, my family and I nestle on the couch and celebrate the coming holiday season by watching National Lampoon’s Christmas Vacation. Chevy Chase’s slapstick-driven look at family holiday gatherings always seems to strike just the right chord between cynical and sweet. Chase plays Clark Griswald, a man whose expectations and desires to celebrate the holidays with kith and kin collide with the realities of family squabbles, ageing relatives, annoying in-laws, yuppie neighbors, and squirrels running amok in the house. Easy to dismiss as an anti-Christmas movie, Christmas Vacation lampoons cultural representations of families with a smile on their face and a song in their heart during the holidays. The movie offers, instead, a comedic look at the tensions holidays create while still valuing the core need to gather with our families around the hearth at certain times of the year.

But the movie is about more than cousin Eddy holding out for a management position or Clark enduring Uncle Lewis’ smelly cigar.

Chase’s movie is also a subtle (and sometimes not so subtle) attack on the soulless corporate world that puts the bottom line before the worker. Mr. Shirley, Griswald’s boss, is a man who values efficient production and investor profits over employees. Enrollment in the Jelly of the Month Club (see the video) might be the gift that keeps on giving, but such a gift is a scant reward for company loyalty and dedication.

At least Christmas Vacation ends happy. The American middle class, folks like Clark Griswald, might not be so lucky as they witness their power–both politically and economically–shrink each year.

Or, to put it more accurately perhaps, the wealthiest American’s are increasing their wealth, the poorest American’s are falling farther and farther behind, and the unlucky saps in the middle are hanging on for dear life. Most of us know this intuitively when we pay bills each month, but if you want evidence check out Emmanuel Saez and Gabriel Zucman’s slide show, look at the charts from the World Income database, consider that those of you earning $68,000 make more than 75% of the population, and realize those of you making $160,000 are richer than 95% of your friends and neighbors. Anyone earning $300,000 feel super-rich? You should because you are in the top 1% of all wager earners.

In the meantime, Clark Griswald’s boss, the man who changed cash bonuses into a Jelly of the Month Club membership, earns 350 times more than the average worker and his salary increases while Clark’s remains flat.

Criticism and distrust of American corporations is nothing new, of course. Herman Melville’s 1853 short story “Bartleby, the Scrivener: A Story of Wall Street” ends with the narrator lamenting his own inhumanity when the bottom line conflicts with his ability to serve as his brother’s keeper. Oliver Stone’s Wall Street takes a scathing look at greed and American culture, and Mike Judge’s 1999 Office Space satirizes the de-humanizing impact of cubicles and management drones.

This tension and interplay between worker and owner (or the bourgeois and proletariat) created labor unions, workers who banded together for fair labor practices, safe working conditions, and a living wage. Profits were shared among the workers and management. If pay and work conditions became untenable, unions joined together to strike, demonstrating the power of the working class.Unions and their corporate counterparts worked throughout the years to create a vibrant and powerful American economy. In our golden age, wages were more important than stock value for anonymous shareholders.

Until now.

At the risk of confusing correlation and causation again (see my post from last week), I can’t help but notice that American workers have lost wages and power in equal proportion to the collapse of labor unions.  Edward McClelland, over at, offers some basic facts. In 1965, McClelland tells us, $2.35 (starting salary for shoveling taconite) was enough to pay rent and buy a car. That $2.35 would equal $17.17 in today’s wages, almost $10 higher than minimum wage.

I don’t think anyone would argue someone could pay rent and buy a car on $7.25 an hour.

Labor unions, at their heart, offer workers collective bargaining, recognizing that the value of any company is determined not by the person in the corner office sitting in a leather chair, but by the worker shoveling coal, writing reports, and interacting with customers. When profits are shared fairly, America’s economic boat rises in equal proportion.

Somehow, though, American voters and politicians turned union into a dirty word. President Reagan, friend to almost no one who didn’t live in a gated community, convinced too many workers to turn their backs on their own best interests. In a show of solidarity with the corporate owners, he broke the air traffic controllers union, proving that government really was part of the problem not the solution. Ironically, we named an airport after him but that’s a different blog.

As importantly, President Reagan obfuscated the conversation by emphasizing social issues over sound economic policy. We became obsessed with the welfare queen who might be getting an extra $40 more food stamps while the corporate executive was finagling another 30% more in tax cuts.

Meanwhile, union membership dropped dramatically and Republican politicians, buoyed by redistricting and corporate donations in the 1990s, trumpeted the free market, off shoring, and corporate welfare.

Wages froze. The middle class shrunk. And Walmart took over the world.

Even now, as the economy recovers and unemployment drops, wages are stagnant. Fast food workers are demanding a living wage and prices for gas, utilities, and other essential goods and services are rising faster than our paychecks.

Yet, we are all single voices raised in competition with each other, fighting over limited resources regulated by owners who control both the mode of production and the product.

In Clark Griswald’s world, cousin Eddy, a big, bulging man in a blue polyester suit, has to kidnap Mr. Shirley to remind him that “Sometimes things look good on paper, but lose their luster when you see how it affects real folks. I guess a healthy bottom line doesn’t mean much if to get it, you have to hurt the ones you depend on. It’s people that make the difference. Little people like you.”

The rest of us don’t really have to rely on kidnapping (or blue leisure suits). We just have to remember that divided we fall. United we stand.

Turning Off and Tuning Out

I’ll admit that I’m a political junkie and a news addict. I read multiple papers each day, listen to NPR, check out CNN, and Fox News. Andrew Sullivan and the Huffington Post are must reads throughout the day. Slate, the Economist Magazine, Mother Jones, and the National Review make my weekly reading list. Heck, I even check out Bill O’Reilly on occasion just to hear what the crackpots are thinking.

But I am growing weary of the idiocy that passes for political thought in America today. Nancy Pelosi has decided President George Bush is to blame for the IRS scandal while she defends President Obama because he can’t know everything that happens in every government department. One assumes, Speaker Pelosi, that if the current President doesn’t know what’s going on, perhaps the ex-president is equally in the dark?

Rep. Stephen Fincher voted against food stamps (because the bible told him to) while accepting millions in farm subsidies for his family farm. Don’t you wonder if politicians ever listen what they actually say? Food stamps just make individuals dependent on the government, Rep. Fincher argues, farm subsidies help those farms that are struggling when times get tough.


I’m no economist, and I didn’t stay at a Holiday Inn Express last night, but I’m fairly certain one of the basic tenets of the free market is, in fact, not propping up businesses with tax dollars. The free market only works, Mr. Fincher, if some businesses fail.

Yet, I still listen, read, and watch the news, enjoying that sense of ironic detachment as we watch politicians perform linguistic gymnastics justifying hypocritical and contradictory ideas.

Until this week.

As I listened to Senator Rand Paul defend Apple computers for paying what they “legally” owe, regardless of the nefarious methods by which they avoid paying their fair share, I realized I had enough. At some point, the absurdity of hearings celebrating Apple’s ability to avoid paying taxes while holding hearings across the street about the IRS investigating conservative political organizations to be sure they pay the correct taxes was just too much.

And I turned off NPR earlier this week when Sen. Levin of Michigan refused to recognize that perhaps, just maybe, Congress might need to accept a little, tee-tiny amount of blame for passing ridiculously complex tax laws and using Capitol Hill hearings as opportunities to politicize and demonize everything from apple juice to disaster aid. Is it any wonder that various agencies and workers investigate groups their powerful political supporters characterize as nazis and terror groups?

What really pushed me over the edge, though, was listening to President Obama tell us, yet again, that he plans to close Gitmo and ask Congress to re-define the use of drones in the war on terror. Great goals all, and I have a great deal of sympathy for the President’s inability to convince Congress Gitmo is largely a concentration camp whose mere existence is offensive to American ideals of truth, justice, and fairness, but I find his stance on drones disingenuous. If you don’t like the way we use drones, Mr. President, stop using them that way. Just because an act is legal doesn’t mean you actually have to perform that action.

We shouldn’t have to pass a law showing us the moral path.

But, as I was falling over that ledge, the Republicans started throwing rocks from above. Evidently, the mere act of giving Congress the task of defining legal drone use and the simple hint that we might re-define the war on terror equates to letting the terrorists win. Remember, though the President is a Kenyan born Muslim who is trying to enact Sharia law in place of the Constitution. Ironically, of course, too many of those politicians ready and willing to kill in the name of American freedom deferred when their names where called back when it mattered.

Because, in American politics today, hate has replaced honest disagreement. Personal attack has replaced ideological differences.

And I’m fairly certain personal ambition has replaced willing public service.

This weekend the politicians can go on tv and explain how they can vote against disaster aid for the east coast while demanding it for the mid-west. The sons and daughters of immigrants, both legal and illegal, can argue about protecting our borders and deporting human beings. Married men and women can stand with their spouses while telling the rest of us who we can, and can’t, marry.

And they can all attack the IRS and our uneven, hypocritical, unethical, and incomprehensible system of taxation while never admitting they have seen the enemy and it is them.

But this weekend, as we honor those men and women who serve our country protecting my right to be apathetic and my elected representatives’ right to say stupid things, I’m turning off and turning out.

I’m pretty sure when I tune back in Tuesday, I won’t have missed much.

2+2=5, Or the Federal Budget

The latest Pew Poll shows that, surprise, most Americans don’t have a clue how the federal budget works. That’s okay, though, because I’m also pretty sure our elected officials don’t understand the budget either.

In our defense, budgets are complex things once you turn 18 and get all grown up. For my kids, handling money is relatively easy. Money comes in and money goes out. In large part, these are fixed things. My son gets a budget allotment from us and he works at Outback a set number of hours each week. He can estimate his income within a few dollars. His expenses depend on his personal choices. There are no long term deficits (housing), mid-term deficits (cars), and short term contracts (phones) to worry about. Recurring costs are minimal, mostly because we don’t charge our kids rent or utility costs (although we did once start charging my older son a dollar every time his shower lasted longer than 12 minutes).

Our household budget gets a bit more complex. We have fixed costs (house, car, phone, insurance) and anticipated costs (utilities, food, gas, cable). These are usually about the same each month. Fortunately, we also have a fixed income. We know within a few pennies how much money we will make every month. Obviously, that means when we buy the house, car, etc, we know how much we have to spend. We also, though, have variable costs: medical, family emergency, total inability to cook night, increased alcohol consumption (based on too many inability to cook nights), and vacations (to try to stem the previous costs). Still, all in all, we know each month how much money will come through the door and about how much will go out. We also know, though, that the income can go up and down (based on taxes, job-related issues) and the costs can go up or down (pay off the car, insurance rates). The complexity is that we do, in some way, have to plan for those contingencies, knowing we have to make some purchases based on potential future expenses.

Naturally, that means I should understand the federal budget. Except that I don’t. A federal budget has variables that seem almost infinite: it is my budget on steroids. The amount of money coming in can depend on natural disaster, terrorist attacks, consumer confidences, unemployment rates, world markets. The cost has just as many variables. Economics, I tell my son, is like creative writing with numbers. The experts are all just guessing (educated guesses for sure) but they can only anticipate. And they study this everyday.

That leaves the rest of us guessing (often not educated). Let’s start with the obvious reasons we are so confused:

1. I can’t count to a trillion (or a billion, and I have my doubts about the number of zeros in a million). The number one reason most Americans are stupid about the budget is that the numbers we discuss are incomprehensibly large. The well meaning among us can talk all day long about decreasing spending and creating efficiencies,  arguing that cutting aid to Africa and reducing the federal work force will save millions of dollars. The problem, of courses, is that aid to Africa and the size of the federal work force isn’t driving the deficit. And, hard as it is to believe, saving a million dollars (or even 10 million) is a bit like arguing that saving $10 a month will let you buy that condo in Maui. Because we don’t quite get the numbers, we keep imagining we can reduce the deficit by cutting the low hanging fruit. We can’t. There isn’t enough fruit there and we consistently under appreciate the importance of that money. Cutting aid to Africa will save us money, until the disease and disharmony requires a larger response. Cutting federal workers will save the government money, but the service they provide doesn’t end. Outsourcing simply transfers the cost. (Think of it this way–if your city outsources garbage collection, that simply means you won’t pay your city to collect the garbage. You will still pay for garbage collection, but you will pay a for-profit company. They might be more efficient by paying workers less money with fewer benefits. That short term savings becomes a long term cost in medical care, retirement, etc.)

2. Americans aren’t really ready to make the difficult choices to cut programs that will reduce the deficit. We have the greatest military in the world and we damn well should based on the money we spend. The reality is that the military-industrial complex has done exactly what President Eisenhower warned–it grows and consumes. I love freedom, and I know that freedom isn’t free, but I also know that our military expenditures have taken on a life of their own. Simply put–we must reduce our military footprint, reduce our reliance on increasingly expensive technology, and stop being the world’s police. If we aren’t willing to do so, then we have to accept an increasingly expensive military. In other words, we need to decide that we can have a less expensive version of freedom. And by all means, let’s stop subsidizing wealth for Lockheed Martin’s executives.

3. Our social programs must change. Social security is important and vital to the well-being of an aging work force. We must continue to support the social safety net for those workers whose lifetime profession didn’t include 401(k) programs, pensions, and other job related retirement accounts. American cannot be a country that abandons laborers whose jobs depend on physical abilities that fade over time, pushing them to either lower paying jobs or retirement. Doing so requires that we stop trying to treat all retirements equally. The social security age should be raised for certain professions and certain income levels. They guy down the street who runs a backhoe and digs ditches probably has a more difficult time doing his job at 62 than the college professor living in my house. More importantly, he doesn’t have an employer matching his retirement fund dollar for dollar. Index for income. We all benefit from putting money into Social Security because no one really wants a bunch of old, poverty-stricken homeless people running around. Or moving in with us.

4. Medical costs are out of control. Read Steven Brill’s Bitter Pill: Why Medical Bills are Killing Us. Let’s stop fighting about who pays and worry about why we are paying so much.

5. More revenue is not evil. Federal taxes are at their lowest levels in years but federal tax law is more confusing than a physics dissertation to an art major. We can increase revenue and stabilize revenue pretty easily if we could, and I know this is a radical concept, consider the greater good and not simply our own self-interest. Let’s start with two basic concepts: everyone pays something and we eliminate loopholes. We do this via either a national sales tax. Want to pay less in taxes, buy less stuff. The idea that the rich would reduce spending misunderstand the rich. Bill Gates doesn’t live in a mansion because he has to. He lives there because it speaks to his wealth. A consumption tax would, in fact, allow us to budget based on 10 year spending averages. If we don’t like the consumption tax, then create a progressive flat tax: 0-20,000 pays 10%; 20,000-30,000 pays 15%, 30,000-40,000 pays 16% . . . You get the idea with a top rate at 25% for those making over $5 million. No caps. No loopholes. And no whining. If you are making $10,000, put some skin in the game. If you are making $10 million, you will not stop producing or stop pushing yourself to make money to avoid taxes. You live in the greatest country on the planet and you make $10 million because you live here. If you don’t like it, leave. Go try to be rich in Venezuela.

It’s either that or let’s make that 1 trillion dollar coin. Heck, let’s make two.

Paying the Taxman, I think

screamI am relatively convinced that tax law and IRS forms are designed and written by college freshman shortly after toking up. To think otherwise would assume that sober men and women with fully functioning frontal lobes could conceive of these forms. That’s more frightening than Hannibal Lecter, Jeffrey Dahmer, or the zombie apocalypse. Feel free to kill me, boil me up in a stew, and feed me to the neighbors–just don’t make me try to figure out if I need to complete form 1089, schedule D, appendix RULOSTYET.

No one really likes to pay taxes and, other than Warren Buffett, I don’t see my neighbors rallying for fewer exemptions. But, I think, when we dig deeply enough, we can see that the basis of the tax code has good intentions. Like washing the dirt, grime, and soiled sins of humanity off the early explorers of the new world, we can see a clear sense that the original intent was noble. We wanted to create a system that allowed us to share the costs associated with our core national values.

I’ll also admit that I have myself sucked at the teat of big government. I’m a product of public schools, have allowed the government to partially subsidize my college education, happily contribute part of my salary to help fund social security, and willingly pay to keep our soldiers armed and ready. I am also proud to contribute my fair share to pay for roads so my friend who owns a business can deliver goods, to pay pennies on the dollar so my colleagues at public institutions can teach and research, and to send in my little bit to fund the arts and Big Bird. I don’t even, for the most part, mind paying the salaries of our political leaders. (Well, most of them. I don’t what the heck the voters in some districts are thinking by electing some of those numbskulls.) I’m even willing to fund a savings account to help states deal with natural disasters and pay so scientists can ensure my food arrives safely to my table. I sure as heck can’t afford my own personal taste tester.

I’m not even horribly bothered by those people who take advantage of the system or wasteful government spending. We are a nation of 300 million people. Inefficiencies are part and parcel of the deal. For every welfare cheat or $300 toilet seat, we saved someone’s life, fed a hungry child, and protected someone half-way across the world today. Some people cheat and some people get more than they deserve. Hell, I’ve only got 4 people in my house and we have the same problem.

These are the shared costs of being an American. I’ve got your back and, I hope, you’ve got mine. The good outweighs the bad.

But our IRS forms and our tax systems seems designed to make me bitter and angry about paying my taxes. The complexity of the system contributes to our large national malaise about shared costs and shared benefits. Federal taxes are, for the most part, lower than they have been in five decades. More people than ever are benefiting from our educational subsidies, social security, and medicare. We have the best military in the world. And we just had yet another peaceful government election to decide who will pass laws. (If you need a refresher on how amazing our election cycle is, go visit Syria, Egypt, or Venezuela.) Despite what your crazy right wing friend writes on Facebook, things aren’t that bad. We have 11 million people who risked life and limb to get here so they could join us.  We are, and I’m not afraid to say it, an exceptional country.

But if we are so darn good, why can’t we figure out a tax system that isn’t so darn difficult? At what point do we create a system so unwieldy it becomes a mockery of itself? (Yeah, yeah–I’m fairly certain we are there already. Every time I do my taxes, I feel like I’m in a Saturday Night Live skit. I keep waiting for Will Ferrell to walk in the room.)

More importantly, why have we created forms designed to collect my share of government expenses (which I’m willing to pay) that alternately find ways for me to avoid paying my fair share? It’s a bit like giving students a math test but offering them a chance to fill out alternate forms explaining why they should be exempt from answering certain questions.

Our tax system has evolved into a mess of contradictory desires. Fundamentally, though, the system has become so burdensome the amount we pay seems disproportionate to the benefit we receive, but most importantly, the way we pay creates perceived inequities and a sense of unfairness. Why, we might ask, does the rich guy get to itemize for his house (because he pays so much) but all us in the middle don’t? Why, we might wonder, does the person on the bottom pay nothing? We become, and the form fuels this idea, more and more focused on what others are paying or not paying that we lose sight of what we gain.

But when the form has 15 exemptions, deductions, and various goofy exceptions designed to give you a break on one side while taking it back on the other, what else are supposed to think?

I guess the best thing to do is grab the calculator, light up, and start filling in the boxes. Hopefully, I can claim I’m smoking for medicinal reasons. There’s a deduction for that, right?

I’m Not an Economist but I Will Play One in Court


Click to view Holiday Inn Express Commercial: It’s really funny.

If it’s budget time in Texas, the solution to school funding must be vouchers. Or, at least, that seems to be the solution according to Joseph Bast, president and CEO of Heartland Institute, a witness for Texans for Real Efficiency and Equity in Education, or TREE as they call themselves. I’m assuming Real Efficiency (not fake efficiency, mind you) involves not using all the letters of your name in your acronym, but I guess that beats spelling Tree with three E’s and then pretending you care about education. Plus, your business cards are cheaper if you use fewer letters.

For those of you who live outside Texas, every 10 years or so, our school districts sue the state in the hopes of getting fair, equal, and adequate funding for public education and every 10 years our legislators moan and groan while they let the courts make all the difficult decisions. They then campaign as victims of activist judges who have removed local control and, since Texas believes in grossly under-funding most essential services at the state level (forcing local governments to raise taxes or do without), they travel across the state and social media touting school vouchers and school choice as the pathway to efficiency. Let education, they tell us, be market driven. Taxpayers fund the lawsuit, the lawyers get rich, and our funding mechanism remains a mystery to the rest of us.

I’m not opposed to the basic concept of school choice, vouchers, or charter schools. In fact, I’m pretty much in favor of the charter school concept mostly because it allows educators to open a school independent of many state regulations that force our public school principles to wade through a river of paperwork every day. Administrators in charter schools have the ability to hire and fire teachers, develop their own accountability systems, work outside the demands of standardized testing, and they have greater budget authority. Hell, if we gave public schools those things we wouldn’t need charter schools or vouchers.

And we clearly need to do something about using property taxes to fund public schools. We don’t need a lawsuit to tell us such a system creates massive inequities in per student spending.

But I’m not writing about vouchers or charter schools today. I’m writing because Mr. Bast, president and CEO of the Heartland Institute, serving as a witness for TREE (E), a group that is not a plaintiff in the case, “has not graduated from college and holds no degree in economics, though he considers himself an economist” and he admits that “neither of the two reports he co-authored, which were entered into evidence, have been peer-reviewed.” In essence, Mr. Bast isn’t qualified to be a credible source on a student research project but he is allowed to testify in a Texas courtroom because, without any credentials or evidence to the contrary, he has declared himself an economist. He may not be able to solve public education’s funding issues, but he just solved our higher ed problems. No more pesky classes, tuition, or professors: we will grant degrees by personal fiat. Today I am a (fill in the blank). If you spell the career choice correctly, you can grant yourself the degree. Have a party this weekend, smoke some dope, and you can have the college experience before your parents turn your room into an office.

And, in a state that loves school vouchers and grasps at anything that will cut funding to social programs, Bast admits “no government entity in the state of Texas ever has agreed with [his] analysis of savings.”

So. If I have this correct: he’s not qualified, he hasn’t submitted his ideas to review, and no one agrees with him. He’s the perfect witness. I’m just not sure for which side.

We wonder why our funding models are so awful? Shame on Judge Dietz. Shame on TREE (E–just add the damn E!). And Shame on Mr. Bast. A court is no place for amateur-hour.

Perhaps, if I might be so bold as to suggest, if we only allowed witnesses with some measure of expertise to testify the trial would go faster, we would save some money in legal fees, and we could funnel those dollars into the classroom. Just spit-balling that idea.

And, more importantly, next time Mr. Bast wants to act the expert, he can just start a blog like the rest of us.

Have I Got a Deal For You!


Click to view clip

Back when my wife and I first got married, we did the garage sale/flea market tour about once a month. As graduate students with little money (and not much pride), we picked up our furniture, dishes, and clothes (no mattresses or underwear–we did have some standards). Early in our shopping days, we struggled with the haggling, almost always offering either too much or not enough. No one scowls quite like a garage sale worker insulted by a low-ball offer.

Eventually, experienced hagglers learn the artful dance of making an offer without actually making an offer. You begin by discussing flaws, sighing loudly as if your mere interest is a favor to the seller, walking away, wandering back (as if on accident), and then feeling out the seller. All the while you recognize haggling Rule #1: never make the first offer. Nothing feels worse putting your new found treasures in the trunk than wondering if you overpaid. “He took the offer too quickly. I should have offered $.25 less!”

This is a negotiating tactic that we see at all levels. When my two boys were younger, we did our level best to teach them both how to share and how to negotiate a fair deal. I’m not saying we were cheap, but our approach to gift giving was somewhat communistic and revolved around shared ownership. Why get two toys when we can just learn how to share? Unfortunately, for those of you with children, elementary-school morality is a little less communal and a little more capitalistic–he who has the most toys wins. Or, more apt, possession is 9/10’s the law for the bigger kid.

Don’t misread our goals and methods as achieving success. Negotiation worked as long as the bigger, older son controlled the conversation. (Or their mother stepped in–“You agreed to clean his room for WHAT!?”). The younger brother, and I’m a younger brother too, always has to navigate dicier waters and the smaller, younger brother always learns Rule #1 first: never make the first offer. (Rule #1A: Hold out and hope mom steps in.) The hope is the older brother, in his arrogance and power, will slip up and offer too much. Maybe you get the toy for longer or you get a supplemental toy or you get some future relief from torment. Honestly, my wife took the lead here, being much more willing to step in and broker a deal. (Evidently, she didn’t appreciate my survival of the fittest ideology when it came to the boys.) The problem was the older brother negotiated until he got bored: then he just took the toy. There was a point where he realized talk didn’t cook rice. (And bedtime was looming so play time was getting shorter.)

The drawback to this approach is that the dinner table eventually becomes a little like the market square. “I’ll eat my peas, if . . .” and “If I take out the trash, can I have . . .” but, in theory, this can help kids realize that we are constantly negotiating with the varying ideas and expectations around us. Life, in essence, is about negotiating our wants and needs with the varying groups and individuals around us. Decisions, actions, and negotiated agreements have consequences. Yes, we might tell the older son, you can trick your brother into giving you the toy, you might even be able to beat him into giving you the toy, but at what cost? (That, by the way, sounds really good in retrospect, but if your older son is anything like mine, his answer is that there was no cost. “I’ll always be bigger than him,” he says as if I’m the one who doesn’t get it.)

As we head toward the Fiscal Cliff, I’m reminded daily that our political leadership either imagines life and the financial health of our nation is like a flea market or they’ve never stopped acting like elementary school students. Neither party is willing to make the first offer, preferring to wait, afraid that if they offer a cut here or a revenue increase there, they will have offered too much or too little. The difference, though, is that our garage sale businessperson and our buyer at least seem interested in making a deal. While there is some measure of ego wrapped up in the transfer of goods, at the end of the day, I want a truck full of “necessities” and the owner wants an empty garage.

My kids are a good bit older now and while the younger one is still smaller than the older brother, he’s learned enough to avoid making bad deals. Negotiation is a little less dangerous and tends to end much more amicably in our house. They aren’t always happy, but such is the nature of living with and around other people. They are also figuring out that haggling might give you a chance at a better deal, but it slows the process down. The quickest way to make a deal is to make an offer. You don’t for instance argue for days over the last piece of cake. Cut the damn thing in half and enjoy.

As we inch toward December 31st and economic chaos, perhaps our political leadership needs stop acting like a bunch of 8 year olds and stop treating the tax code like a worn out couch and knickknacks we don’t want anymore. If they can’t do that, let’s get their mothers in the room and see what happens.

Death and Taxes

Some days I wake up bright-eyed and bushy-tailed. Then I read the paper. And I get weary. It’s not usually the death and destruction that gets to me. Cold-hearted as that may sound, my eyes blurred and my brain tired this morning reading, yet again, about the Fiscal Cliff. It’s important; it’s huge; it’s political–it’s also largely incomprehensible. We don’t need to reform the tax code to raise money or lower taxes: we need to reform the tax code because it doesn’t make any damn sense and, I’m convinced, it has so many moving parts that no one else understands it either.

When I was in high school, I had Mrs. Roach for World History. She sat in her rocking chair the first day of class and told us we were reading James Michener’s The Source. Michener’s novel, like all of his works, is a kind of journalistic historical novel. The Source is a fictional story about development of Israel. The story moves back and forth in time with multiple narratives as archaeologists dig and the narrator tells us how Israel came into existence.

Mrs. Roach, after her description of the novel, let us know she was an atheist. She didn’t care what we believed, but in her class our focus was on factual knowledge. To think well, she would tell us, we have to place the contemporary world in its historical context and vice versa. History isn’t just some thing we beat to death or learn so we can avoid repeating it. History, she taught us, is the complex web of events that can’t be treated as a linear progression from the beginning of humanity to today. Michener’s novel isn’t long because he’s wordy: it’s long because at any given moment in time millions of things are taking place. Every one of them is historically significant in some way, shape, or form, and every one of them is connected.

Don’t get me wrong. Dates matter. There are events that serve as important historical and cultural markers worth remembering but we also have to recognize that smaller, seemingly less important events often occur that lead to those culturally defined moments. We also have to remember that the importance of any historical event is usually defined after the fact based on the relevant values of the dominant culture. As the dominant culture changes, so does the importance of those cultural moments. (Note to Republicans–you might want to pay some attention to those cultural shifts.) It’s what Paul Harvey used to call the rest of the story.

Simply put: nothing happens in a vacuum and systems are complex because they have all these interconnected moving parts. If one part stops working or if you pull out one part, the rest of the system is impacted and its performance becomes unpredictable. And I can’t think of a system in this world that has become more complex than our tax code.

The San Antonio Express News ran an article today trying to explain what would happen to me if we go over the fiscal cliff. I applaud the attempt but the essay, though well-written and intelligent instantly made me think of Vizzini in the Princess Bride. His logic is incomprehensible simply because he imagines the world as this linear thing with limited options resulting in limited outcomes. By necessity, codes that are this large have to treat people as a monolithic group where every individuals acts just like every other person in the group, even though we know that each economic situation is, like history, a complex web of commitments, desires, and dreams. And we know those situations change. Yearly. Monthly. Daily.

Our tax code’s complexity is worsened by unrealistic budgeting models (we’ll save $1 trillion over 10 years they tell us–but only if the world remains exactly like it is right now). As the President and his opponents jockey for position, they discuss the tax system as if we can simply raise a tax here, change a requirement there, and the problem gets solved.

The problem is that the tax code has to be treated as a complex organism. We don’t, quite frankly, have any idea what will happen if we raise marginal rates and raise the social security age if we don’t also increase expenditures for health care. In the same way, we have no idea what impact better health care will have on increasing the marginal rates on investments. What happens, for instance, when people live longer (better health care) but work longer (more stress) while creating more diverse and sophisticated investment portfolios? And let’s not forget that employ-ability is often tied to available housing(or mobility) which is impacted by local tax rates that are impacted by increased or reduced federal aid and, in theory, all those are impacted by hiring which is impacted by education which is impacted by local, state, and federal tax rates which are impacted by the cost of goods which are impacted by gas prices which are impacted by defense costs which are impacted by foreign aid which . . . you get the idea.

Our current tax code reminds me of my grandparent’s house. It started out as this two room, one car garage house with a living room and kitchen. They had 9 kids so the place went through a steady and almost consistent remodeling. Another kid–close in the garage to make a room. All those mouths to feed–add a pantry with laundry room to the back. Another kid–add a back room with bunk beds. Great concept but there’s a point at which that model creates so much complexity we become prisoners of an incomprehensible blueprint. Turn the hot water on to wash dishes and the toilet flushes. Repairing the front porch light requires turning off the breaker to the refrigerator.

At some point, we just have to tear the whole thing apart and start over. I realize this sounds so simplistic it could never work, but why are we not capable of estimating real and potential costs for any five year period and then budget appropriately? We can have, quite frankly, a progressive flat tax where every person who earns a wage pays a clearly demarcated tax based on wages. When we have a national crisis or war where our duly elected representatives deem it necessary to increase our expenses, that percentage increases. Simple and based on the American concept that we are all benefiting from the system; hence, we all pay into the system. Corporate and other taxable areas would operate in the same way. Mobil oil doesn’t need a tax-break to create jobs. Walmart doesn’t need a tax-break to build a store in my town. If they don’t drill for oil or build the store, they won’t have any customers.

Oy, but I just fell into the trap of simplifying a complex system, didn’t I? Such a tax base requires long and intelligent conversations about what our estimated expenses might be: social security, defense, welfare, education, research and development funds, etc. Of course, we could look to history and develop a 10 year average then budget.

Or, we could just all take a drink from Vizzini’s cup and see who survives.

Things I Read

And Things I Learned

Washington Monthly

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

Joanne Jacobs

Thinking and Linking by Joanne Jacobs

Inside Higher Ed

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

NYT > U.S. > Politics

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

Balloon Juice

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

Dilbert Daily Strip

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

The Full Feed from

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)