Category Archives: Wonk City

Insuring Illegal Immigrants

If you don’t want to give illegal immigrants subsidies to buy health insurance, fine.

But if they come with their own money, why not let them? They’ll keep the costs down for the rest of us (they tend to be younger and healthier than the population as a whole), and it’ll make it less attractive to hire illegal labor (a legal resident is more expensive for a business to hire because the business would have to buy health insurance for them).

Revenue Neutral

One of the big knocks on increasing the cost of emitting carbon as a solution to global warming is that it’s “regressive,” i.e., it hurts the poor disproportionately. I don’t really buy that argument, for a number of reasons. One, the poor are going to be hit the worst by climate change, which will make food more expensive and flood low-lying countries like Bangledesh. Two, the poor don’t lead nearly the carbon-intensive lifestyle that the rich do. Sure the rich can afford a new Prius, but they also fly WAY more than working class people, for example, and tend to have bigger houses, etc.

Be that as it may, the political argument seems to have legs. And the last thing we need is for a bunch of hypocritical Republicans using this issue as a way to express faux solidarity with the working man (remember “Drill, baby, drill!”?). So the issue is how do you increase the costs of carbon without it looking regressive.

Needless to say, Barack Obama has an answer:

Mr. Obama will also propose in the budget outline he releases on Thursday to use revenues from the centerpiece of his environmental policy — a plan under which companies will have to purchase permits to exceed pollution emission caps — to pay for an extension of a two-year tax credit that benefits low and middle-income people.
The combined effect of the two proposals, on top of Mr. Obama’s existing plan to roll back the Bush-era income tax reductions on upper-income households, would be a pronounced move to redistribute wealth and reimpose a substantially larger share of the tax burden on the most affluent taxpayers.

Well played, sir.

Obama vs. McCain on Tax Cuts

Handy little calculator for figuring out what your tax cut would be under an Obama administration. Clearly designed to remind people that, unless you make over $500k/yr, Obama’s plan means less taxes for you.

Of course, I don’t really go for the whole tax cutting argument. Taxes are used to buy government services, and so long those services are relatively efficient and worthwhile (and are things that can be only done by government, not the market), I’m fine with paying them.

Somewhat relatedly, I’ve noticed John McCain has shifted his rhetoric a bit in response to the realization that Obama is acutally proposing bigger tax cuts than he for 95% of the electorate:

I will keep taxes low and cut them where I can. My opponent will raise them. I will open new markets to our goods and services. My opponent will close them. I will cut government spending. He will increase it.

My tax cuts will create jobs. His tax increases will eliminate them. My health care plan will make it easier for more Americans to find and keep good health care insurance. His plan will force small businesses to cut jobs, reduce wages, and force families into a government run health care system where a bureaucrat stands between you and your doctor.

The first point actually allows him to weasel out of any tax cuts at all. The second point is even more interesting. It’s a basic supply-side point about creating jobs cutting taxes for the rich, but it doesn’t come out and say it. The way he says it, it sounds like he’s saying that his tax cuts for all Americans will create jobs. But he can’t say that, because Obama’s cutting taxes more for 95% of Americans. The more accurate way to say this would be, “My tax cuts for the rich will create jobs. His tax increases on the rich will eliminate them.” Obviously he would never put it that way, but that’s what he’s implying.

There Go My People…

… I must find out where they are going so I can lead them!

Matt and I talked about leadership on this week’s podcast, as in, we want to see more of it from our politicians. Pols, however, tend to follow polls. They want to do what’s popular.

But what if the polls aren’t telling them what they think they’re telling them, as in the clip above? That’s what former Gallup pollster David Moore argues in this blog post. In 2003, when “support” for the Iraq War was almost 2-to-1 in favor, he asked a follow up question, “would you be upset if your opinions were ignored?” The result:

What this experiment revealed was that instead of a war-hungry public, Americans were evenly divided over whether to go to war — three in ten in favor, three in ten opposed, with a plurality willing to do whatever the political leaders thought best.

Of course, that’s not the poll result that got all the attention. And so, we went to war.

Taxes

Damon Agnos reminds me of the best chart ever for countering the argument that we’re too heavily taxed in Seattle (Seattle ranks #42 out of 50 and Seattlites pay less in total taxes than residents of Phoenix, AZ or Billings, MT).

But his solution seems wrong to me:

Our low tax burden is one reason our transportation infrastructure has fallen so far behind our population growth. We can continue to face the liberal’s dilemma of regressively funded public works (a divide-and-conquer dream for the Tim Eyman crowd), or we can figure out a more equitable way to create the spending increases needed to fund big city infrastructure. A progressively structured income tax, even if just within the city, would be a good start.

I’m pretty sure that an income tax within the city of Seattle would just drive growth out to the suburbs. After all, of the top-10 highest-taxed cities on in the chart above, many — like Philadelphia — have a city wage tax that has done a lot of damage to the urban core by pushing jobs and housing out to the city limits.

We need an income tax, but it needs to be state-wide. This should theoretically be easier, since, unlike many East-coast cities, our metro area is wholly contained within a single state (so you don’t have issues of businesses hopping across the border to evade the tax).