Kevin Drum

Will California Legalize Pot?

| Sun Oct. 24, 2010 12:54 PM EDT

Via Mark Kleiman, here's an interesting poll result for Proposition 19, the initiative to legalize marijuana cultivation and sale in California. It comes from the pro-19 forces, and I don't have any independent way of knowing how reliable it is, but it shows that standard polling has Prop 19 losing 46%-41%, while automated polling shows it winning 56%-41%.

Take this for what it's worth. I'm basically skeptical that Prop 19 will pass, and I have my doubts that there's really such a large number of people who are afraid to express support for Prop 19 to a live interviewer. Supporting pot legalization isn't really a huge stigma in California, after all. Still, it's interesting if it's legit. We'll find out a week from Tuesday.

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California Business

| Sun Oct. 24, 2010 12:30 PM EDT

The chart on the right comes from the LA Times. It shows that, despite the endless complaints about California being such a business unfriendly state, our corporate tax take has gone down dramatically over the past 30 years:

California takes about 4.7% of what a business produces in taxes — which happens to be the national average. The government take is higher in Alaska (13.8%), New York (5.5%) and Florida (5.3%). Even Texas, known for rolling out the red carpet for business, pocketed more than California — 4.9%.

That's according to an annual study of the tax burdens in all 50 states by the Council on State Taxation, a business-friendly group led by senior executives of Chevron Corp., General Electric Co. and other major corporations. "California is pretty middle-of-the-pack when it comes to business taxes," said Joseph R. Crosby, the organization's senior director of policy.

Granted, there's more to business friendliness than just taxes. California has more stringent environmental rules than most states, for example. And the article notes that California's corporate tax structure tilts downward: big companies tend to pay fairly low taxes while small companies pay higher taxes. (Thanks, Chamber of Commerce!) Still, most of the griping you hear comes from big companies, and most of it revolves around taxes. But the fact is that their tax bill just isn't especially high.

The Asymmetry of Incompetence

| Sat Oct. 23, 2010 3:46 PM EDT

From Thoreau, who lives nearby and who I really ought to meet someday:

I’m probably just dwelling on the trivialities of my comfortable suburban professional existence, but my basic grievance against big companies is that when they screw up they take 6-8 weeks to fix it, usually after multiple phone calls and whatnot, but if I screw up a penalty is immediately levied. This happens on every scale, from billing snafus with $7 fees, to cases of people being foreclosed on even though they had never missed a payment and spent money on lawyers to prove this, to “Oops, we broke the global economy, could you send $1 trillion to our Nigerian accounts?”

The latest snafus on my end are (1) I’m getting a bill for water service in an apartment that I moved out of, for a billing period that doesn’t overlap my last month in that apartment and (2) I set up autopay with another utility, or at least tried to, something didn’t go through, and now I’m paying a $7 late fee....It’s not the $7, it’s the asymmetry of the responsibility. If I screw up (and I still maintain I did everything necessary for autopay!), I have to pay a late fee. If they screw up, they give me runaround. As long as it’s $7 at stake, fine, but they do this at every level. I think of the hassle I had to go through to get the title for my car after I paid off the loan (early) and I can’t even imagine the hell it must be to have your house foreclosed because of a snafu that they didn’t even notify you of (because of another snafu).

So, I say that we should be able to put large companies on hold when they want something, send them through phone trees, and ask them to re-submit paperwork that we may or may not lose track of.

All in favor, raise your hands. Motion carried! 

Friday Cat Blogging - 22 October 2010

| Fri Oct. 22, 2010 1:33 PM EDT

Today's installment of catblogging features rare video footage of Domino doing — well, let's be honest: doing something not very exciting. But new! For her. And I just happened to have my camera around when she did it. That's sort of rare, so today you get rare Friday Cat Vlogging.

To make up for the lack of actual excitement in the video, however, note that my personal video creation skills have taken a great leap forward. Unlike my past crude efforts, this one includes a sophisticated opening title and an actual edit with a diagonal transition. Thanks, Microsoft Movie Maker!

In other pet-related news, Chad Orzel is writing a sequel to How To Teach Physics To Your Dog, so he's running a contest that will benefit the DonorsChoose fundraiser to support public school students and teachers. Here's the deal: Chad's book is full of animal characters, and he promises to name one of them after the biggest donor to his fundraising drive. But what if we all made donations in Inkblot's name? Simple arithmetic would make this the biggest donation, and he'd be forced to recognize this and feature Inkblot in his book. Right? I mean, the guy's a physicist, after all. So head on over there and give til it hurts. The kids it will help are all well and good, but this is really for Inkblot. He'll be watching.

Quote of the Day: Social Security

| Fri Oct. 22, 2010 12:35 PM EDT

From Robert Reischauer, former director of the Congressional Budget Office, talking about Social Security:

It's quite a manageable problem.

Yep. We could solve Social Security for all time in about a day of easy negotiations if both Democrats and Republicans were actually serious about solving it. The required set of benefit cuts and revenue increases would be so minor, and would phase in over such a long period, that virtually no one would even notice.

Too bad we're not serious about it.

Google's Tax Bill

| Fri Oct. 22, 2010 12:17 PM EDT

After reading a recent Bloomberg article about how Google reduces its corporate tax rate by shuttling money between Ireland, the Netherlands, and small Caribbean islands, Tim Fernholz wonders if this betrays Google's "Don't Be Evil" motto:

So is this action evil? If Google's definition of not being evil is 'doing more than the average corporation to support the public interest,' then sure it is. It's one thing to take advantage of legitimate tax law, but exploiting these loopholes for the sole purpose of paying less tax violates the spirit of the law, if not the letter. That would be fine if Google was content as a typical business, relentlessly pursuing profit with no thought to the public interest. They simply shouldn't pretend they're somehow better than the Exxons and Goldman Sachs of the world.

Put me down on the "not evil" side. There are, obviously, some tax dodges that are egregious enough to qualify as pretty close to evil. But declaring revenue in whatever country gives you the best tax treatment? No matter how many clever names we make up for this, the fact is that virtually every company with foreign operations does this. It's just routine. Google's motto is "Don't Be Evil," not "Don't Be An Idiot."

More generally, I think that taking full legal advantage of tax laws is rarely unethical. We all do it. I think that the mortgage interest deduction is bad policy, for example, but I never miss an opportunity to declare it. Ditto for any other deduction I can get away with, regardless of how I feel about it from a philosophical point of view. I'd be happy to see the tax code changed, but in the meantime I certainly don't feel bad for refusing to be a high-minded sucker while everyone else follows the actual existing law.

The scandal here isn't that Google is doing what it does. The scandal is that our tax laws allow it. Articles like the Bloomberg piece on Google serve a purpose, but that purpose shouldn't be to pretend that Google is doing anything wrong. The purpose should be to wake people up to how our tax code works. Answer: not very well. If there's any evil here, it's in Congress, not Silicon Valley.

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Fixing the Budget

| Fri Oct. 22, 2010 11:39 AM EDT

Reihan Salam is unmoved by Michael Kinsley's argument that the country is broke and we need to modestly raise taxes on high earners to fix things:

Before asking taxpayers — any taxpayers — to dig deeper, I’d gently suggest that we look at public bureaucracies. If the Milwaukee Public Schools spend twice as much as choice schools to deliver the same results in terms of reading and math scores, I'd say MPS can dig deeper, ideally by restructuring compensation and giving workers more autonomy. If one-fifth of public dollars spent on infrastructure are essentially wasted, as Barry LePatner argues in his brilliant new book Too Big To Fall, which I'll discuss in greater detail soon, I'd say the bureaucracies we've placed in charge of public construction projects can dig deeper, ideally by doing a better job of sharing data and using life cycle assessments. If we could reduce Medicare expenditures by 8% per year by creating a competitive pricing system, I'd say the federal government can dig deeper by making a commonsense reform that will leave the quality of Medicare unchanged if not markedly improved.

I'm fine with this as a general idea. But let's look at these three examples. (1) There's no magic to cutting school spending. We can do it by paying teachers a lot less and wiping out programs for disabled kids. That might not be as good an idea as it sounds like — and in any case has very little to do with the federal budget. (2) Focusing more on infrastructure maintenance is probably a good idea. But it's hardly a panacea. (3) Competitive pricing reduces Medicare expenditures 8%, not 8% a year. And that's only assuming that the AEI study that produced this number is right.

My point here isn't that Reihan is wrong about making government more efficient. Of course he's not. It's that whenever you dig into this stuff, there's always less than meets the eye. My guess, for example, is that our infrastructure spending ought to go up, not down. We probably need to spend more on maintenance and more on new projects. And reducing Medicare expenditures is a huge problem, not a quick efficiency fix. Efficiency is a legitimate issue, but Medicare's problem is mainly that we pay people too much and demand too much medicine. What's more, proposals like AEI's for increasing Medicare efficiency are all frankly speculative. We should give them a try, but we should also treat them with the same skepticism that we'd treat any untested new idea.

The plain fact is that budget numbers simply never add up without tax increases. Not even close. We took a nice holiday from history for eight years under George Bush, cutting taxes and increasing spending and figuring that everything would come out fine in the end. But it didn't, and the bill is coming due.

How should we pay it? Well, the income of the rich has doubled or more over the past 20 years and their tax rates have gone down. Restoring their old tax rates, which quite plainly didn't produce economic stagnation, is part of the answer. Making government more efficient is a good idea too, though actual ideas for doing this usually stumble pretty badly when anyone tries to put them into practice. And getting Medicare under control is Job 1. But that's sure not going to happen any time soon after the Republican demagoging of Medicare cuts that's marked the current election season.

Tax increases are coming eventually for both the rich and the middle class. It's the only way to make the sums work. And since the rich have seen their incomes rise so much and have benefited the most from tax cuts in the past, their taxes are going to go up more. Nothing else really makes sense.

Our Media Future

| Fri Oct. 22, 2010 10:48 AM EDT

I don't care much about whether Juan Williams deserved to be fired, but this part of the Bill O'Reilly segment that got him in trouble is actually pretty revealing. Here's the setup from O'Reilly's monologue:

OREILLY: Today on “The View,” the ladies addressed the shootout I had with them last Thursday when I said that building a mosque near Ground Zero is inappropriate because Muslims killed us there. That caused Whoopi Goldberg and Joy Behar to walk off the set. Of course, what I said is absolutely true, but is insensitive to some. In a perfect world, you always say Muslim terrorists killed us, but at this point, I thought that was common knowledge. I guess I was wrong.

And here's the subsequent discussion with Williams:

WILLIAMS: Wait a second though, wait, hold on, because if you said Timothy McVeigh, the Atlanta bomber, these people who are protesting against homosexuality at military funerals, very obnoxious, you don’t say first and foremost, we got a problem with Christians. That’s crazy.

O’REILLY: But it’s not at that level. It doesn’t rise near to that level.

WILLIAMS: Correct. That’s — and when you said in the talking points memo a moment ago that there are good Muslims, I think that’s a point, you know?

O’REILLY: But everybody knows that, Juan. I mean, what, are we in 3rd grade here or what?

WILLIAMS: No, you don’t — but you got to be — this is what Barbara Walters was saying —

O’REILLY: I got to be careful, you just said it. I got to be careful. I have got to qualify everything 50 times. You know what, Juan? I’m not doing it anymore. I’m not doing that anymore.

Italics mine. So O'Reilly has simply decided that he doesn't feel like referring to "Muslim terrorists" anymore when the subject is Muslim terrorism. Too much work, I guess. He's just going to say "Muslims" and have done with it.

By analogy, I guess I can now say that Bill O'Reilly has an "immigrant problem" and be done with it. Sure, he says his problem is really only with "illegal immigrants," but whatever. Everybody knows that already, and I don't really feel like qualifying everything anymore. Hopefully O'Reilly doesn't mind.

Feel free to come up with other examples in comments. There's a million of 'em, and they do wonders for keeping public conversation in a permanent state of roiling hatred. I can't wait until we're all doing this all the time. It should be awesome.

Our Coming Mega-Drought

| Fri Oct. 22, 2010 5:00 AM EDT

Here are a few recent data points for you: (1) The New York Times reports that "skepticism and outright denial of global warming are among the articles of faith of the Tea Party movement." (2) In the National Journal, Ron Brownstein notes that "The GOP is stampeding toward an absolutist rejection of climate science that appears unmatched among major political parties around the globe, even conservative ones....Of the 20 serious GOP Senate challengers who have taken a position, 19 have declared that the science of climate change is inconclusive or flat-out incorrect." (3) It's not just Senate candidates. ThinkProgress notes that an analysis by Wonk Room "finds that 22 of the 37 Republican candidates for governor this November are deniers of the scientific consensus on global warming pollution." (4) The Wall Street Journal reports that "extreme drought" has taken hold in parts of nine states stretching from the Southeast to the lower Midwest.

As it happens, this southern U.S. drought is probably not caused by global warming — not mostly, anyway. Like most droughts until now, its primary cause is natural climate oscillations (this year's La Niña) and bad luck (no hurricanes so far this season). But don't count on that continuing. In a new paper that reviews the recent literature on drought, Aiguo Dai of the National Center for Atmospheric Research in Boulder concludes that we're headed for serious and sustained droughts in much of the world. And not in the far future, either. As the maps on the right show, vast swathes of the world are going to be far drier than they are today in a mere 20 years. "A striking feature," Dai says of his analysis, "is that aridity increases since the late 20th century and becomes severe drought [] by the 2060s over most of Africa, southern Europe and the Middle East, most of Americas [], Australia, and Southeast Asia."

In other words, virtually all of the world except for China and Russia will experience increased drought by 2030 and severe drought by 2060:

This is very alarming because if the drying is anything resembling Figure 11, a very large population will be severely affected in the coming decades over the whole United States, southern Europe, Southeast Asia, Brazil, Chile, Australia, and most of Africa....Given the dire predictions for drought, adaptation measures for future climate changes should consider the possibility of increased aridity and widespread drought in coming decades. Lessons learned from dealing with past severe droughts, such as the Sahel drought during the 1970s and 1980s, may be helpful in designing adaptation strategies for future droughts.

The Sahel drought killed upwards of a million people, and since then the steady increase in drought conditions in sub-Saharan Africa has probably contributed to ongoing crises in Darfur, Chad, and elsewhere. Now imagine what the world will be like when droughts are twice as bad, last twice as long, and cover not just sub-Saharan Africa but upwards of half the landmass of the planet. That's not really something you can adapt to.

And here's some even worse news: these projections are based on midpoint global warming projections from the last IPCC report. But those projections are looking increasingly understated, and the next IPCC report is almost certain to raise its temperature forecasts. So as bad as Dai's drought news is, the reality is probably even worse.

This isn't something that's a century in the future. If we don't do anything about it, it's more like 20 years away. Tea partiers and their Republican enablers can play make believe all they want, but their kids and grandkids are going to pay the price for it. Global climate catastrophe is looking closer and closer all the time.

The Chamber of Commerce's Hobby

| Thu Oct. 21, 2010 11:45 PM EDT

The New York Times writes today about the vast tidal wave of secret cash that the U.S. Chamber of Commerce is spending this year to support the Republican Party:

Dow Chemical delivered $1.7 million to the chamber last year....And Goldman Sachs, Chevron Texaco, and Aegon, a multinational insurance company based in the Netherlands, donated more than $8 million in recent years.

....The chamber makes no apologies for its policy of not identifying its donors. It has vigorously opposed legislation in Congress that would require groups like it to identify their biggest contributors when they spend money on campaign ads....“The major supporters of us in health care last year were confronted with protests at their corporate headquarters, protests and harassment at the C.E.O.’s homes,” said R. Bruce Josten, the chief lobbyist at the chamber, whose office looks out on the White House. “You are wondering why companies want some protection. It is pretty clear.”

....The chamber asserts in filings with the Federal Election Commission that it is simply running issue ads during this election season. But a review of the nearly 70 chamber-produced ads found that 93 percent of those that have run nationwide that focus on the midterm elections either support Republican candidates or criticize their opponents.

And the pace of spending has been relentless. In just a single week this month, the chamber spent $10 million on Senate races in nine states and two dozen House races, a fraction of the $50 million to $75 million it said it intends to spend over all this season. In the 2008 election cycle, it spent $33.5 million.

I don't know about the rest of you, but here in California I've been watching the Chamber's "voter education and issue advocacy effort" for the past several weeks, and it sure looks an awful lot like the only issue they care about is making sure that every last resident of the Golden State loathes Barbara Boxer. But I guess everyone needs a hobby. The rest of their secretly funded hobby is illustrated by the Times in handy chart form below: