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The Wall Street Journal published a ridiculous article, “The Gender Pay Gap Is a Lot Bigger Than You Think” that used every possible misconception, misstatement, and lie about the gender gap.
The author, Maddy Dychtwald, talks about an 18 cent pay gap differential, but instead of acknowledging that any differentials that exist relate to choices, the article only focuses on retirement funds.
There are many reasons for a pay gap – but it isn’t merely because of one’s gender. It has been shown time and again that many women have alternative career paths by choice: different jobs, amounts of time worked, lifestyle flexibility, and risks in occupation to name a few; therefore, any difference in the pay is a result of those choices and not some sort of discrimination. Dychtwald’s conclusion implies that a gender wage gap is “damaging to women” because women will likely have substantially less money saved and earned over her lifetime. Yet she doesn’t even consider that, for many women, working full time may be “damaging” to women who have alternative life goals — such as raising a family — and that amassing retirement funds might not be the ultimate end focus.
Wage gaps exist as a result of job choices, not gender. It is totally distressing that the Wall Street Journal’s typically consistent and balanced reporting on the concept of gender pay gap allowed this outrageous article to be published — without response.
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The Wall Street Journal weighs in on the surprise surcharge that the Republicans presented in their tax plan — and subsequently defended when it was discovered. I have reposted it below in its entirety, because it is excellent:
You know Republicans are intellectually confused when they send out press releases defending a top marginal income-tax rate of nearly 50%. Yet that’s what they were up to this weekend as they tried to justify their bubble bracket tax rate of 45.6% after our criticism on Saturday.
We called it a stealth tax rate because it’s buried in the fine print of the Ways and Means proposal. It also isn’t part of the tax simplification story Republicans are selling by publicly claiming the House reform shrinks the individual code to four rates from seven. But caught out by our reporting, they are now denying that the fifth rate is stealthy while defending it as good policy.
The 45.6% is a bubble rate because it applies to tax-filing couples who make between $1.2 million and $1.6 million (above $1 million for single filers). The surcharge is intended to claw back any benefit these filers get from the new 12% income bracket that applies to income of less than $90,000 for couples ($45,000 for single filers).
Republicans apparently think it’s unfair for people to pay the same rate on the same dollar of income. So their surcharge applies the 39.6% rate to those first dollars of income for those more affluent taxpayers, which adds about six-percentage-points to the top rate and gets to the 45.6% bubble rate.
Add that to the 3.8% ObamaCare surcharge that Republicans are keeping as part of tax reform, and these taxpayers would now have a top marginal rate of 49.4%. Add state and local taxes, which would no longer be deductible against federal taxes (a policy we support), and these mostly Republican voters would in many states pay a marginal rate (on the next dollar of income) close to 60% and an effective rate (total share of income) higher than they do now. Keep in mind this is Republican tax policy.
It’s no surprise, then, that Republicans are resorting to Democratic arguments that this is no big deal because these taxpayers can afford it. They’re also claiming this is kosher because the 1986 Reagan reform also had a bubble rate of 33% in addition to a top rate of 28%. But a bubble rate of 33% is a lot lower than 50%, which was the top rate before Reagan’s 1986 reform.
And as we wrote at the time (“Gephardt Soap Bubble,” Sept. 25, 1989), Reagan’s bubble rate was also a mistake. It greased the skids for raising the top marginal rate to 31% from 28% as part of George H.W. Bush’s tax increase in 1990. Democrats argued then that the wealthiest shouldn’t pay a lower marginal rate than the merely affluent, and the bipartisan deal was the 31% top rate for everyone.
If the Kevin Brady-Paul Ryan 45.6% bubble bracket becomes law, this will soon become the new top rate for everybody—perhaps when Nancy Pelosi is Speaker after 2018.
The other Republican defense is that this bubble surcharge raises some $50 billion over 10 years to pay for pro-growth tax cuts elsewhere. But these rate increases never raise what they claim because people change their behavior. The political truth is that the estimated surcharge revenue is really going to finance the huge increase in the family tax credit that costs $640 billion over 10 years. This family credit will also be refundable over time, which means it will be paid as a welfare check to people who don’t pay taxes.
In other words, Republicans are embracing higher tax rates a la Democrats to redistribute the money to non-taxpayers a la Democrats. Remind us again why college-educated suburbanites who are successful in business or the professions and are unenthralled with Donald Trump should vote Republican?
The best solution would be for Ways and Means to clean up this surcharge mess when it marks up the bill this week. Failing that, we need a cleanup in aisle two, which is the Senate Finance Committee.
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Nick Timiraos’ recent article in the Wall Street Journal ( Donald Trump’s Spending Push Rankles Fiscal Conservatives, 11/28/16) , is rather disingenuous with his so-called analysis of Trump’s fiscal roadmap. He clearly aims to torpedo Trump’s plan to cut taxes by tying the discussion to deficits — though correlation, of course, does not necessarily mean causation. Timiraos’ analysis is full of half-truths, but it is not entirely certain if that is willfully written or just plain economic ignorance.
First, Timiraos suggests that budget deficits “fell from 2010” but “are on track to climb in the next decade,” yet doesn’t even give any hard data to back that up — because their really isn’t any. A deficit is still a deficit. Going from a $1.4 trillion budget deficit, as Obama had in 2009, down to a $600 billion deficit in 2016, is still a massive deficit. And of course, Timiraos also doesn’t even mention that the “the total national debt nearly doubled to $19.3 trillion from $10.6 trillion when Obama took office.” Those two data points indicate an enormous spending problem on the part of Obama, something Timiraos totally ignores.
Timiraos then has the audacity to try to link rising deficits to tax cuts by Republicans. Timiraos writes, “the last two times Republicans reclaimed the White House from Democrats—in 1981 and 2001—they also successfully pushed for large tax cuts. Deficits nonetheless rose during their administrations.” Again, another instance of Timiraos telling only part of the story. Both tax cuts resulted in huge revenue increases, but it was even greater spending that created larger deficits. The tax cuts were not the problem; the deficits were not caused by a lack of revenue. Even Republicans can overspend.
Once more, near the end of the article, Timiraos tries again to make Obama’s economics to be the pinnacle of fiscal responsibility, when he writes, “Concerns about deficits over the past few years have faded because economic growth remains disappointing and because Washington took several steps to cut spending and increase taxes after deficits jumped in 2009. Deficits have also fallen below projections in recent years due to a surprising decline in the growth rate of health care spending and because interest rates have been lower than projected.” Only the Democrats are unconcerned about deficits — because their deficit spending is so astronomical, it’s better not to talk about it at all! Suggesting that Obama “cut spending and increased taxes” and that “Deficits have also fallen below projections in recent years” again ignores Obama still spent $600 billion – $1.4 trillion more than his revenue receipts were. When deficits are projected to be $1 trillion, and the actual deficit comes in a bit lower than that (but still in the hundreds of billions), you still have a deficit problem! Timiraos also ignores the fact that Obama regularly had record tax receipts each month (noted on this blog numerous times), and yet Obama still could not control his overspending.
To ignore this economic reality of the past eight years, and the simultaneously try to suggest that a tax plan with tax cuts will alarmingly increase the deficit is reckless. Timiraos ought to be ashamed at such blatant hypocrisy.
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Deidre McCloskey’s recent treatise (How the West (and the rest) Got Rich) on was a thoughtful essay on the power of liberty and its impact on economics. For the most part, McCloskey did a fine job explaining classical liberalism (“worthy of a free person”) and how the Great Enrichment — our uplifting out of poverty — really came about only when man began to have the liberty to think new ideas and create them.
There was one section, however, where Ms. McCloskey was incorrect. She indicated in passing the right had championed “Social Darwinism” and put forth concepts like eugenics — but this is incorrect. The idea gained footing during the Victorian Era due to the evolutionist Herbert Spencer, and it was promoted by progressives such as Teddy Roosevelt and Woodrow Wilson in the United States. The idea that people should be left by the wayside in a “survival of the fittest” kind of mentality is particularly repugnant and certainly not one espoused by conservatives or libertarians. Conservatives and libertarians are notoriously more generous; liberals don’t take their own money and give to the poor — they take other people’s money and give to the poor.
Consider for a moment too, the idea of wealth input. When people like Bernie Sanders suggest that wealth is unfairly going to wealthier people — well, how do you determine how much should go to each person? Should it really all be the same? Is that equality? Should LeBron James get the same as the least talented player in the NBA? We should be focusing on the equality of opportunity — the quality that you put in is equal to what you get out of it.
For example, Bill Gates make tens of millions a year and he pays several people $1 million or more a year because they are worth it to him. If Gates paid only the minimum wage, other companies would snap the employees up because of their talents . Gates, in paying some of his employees large sums, has recognized their worth because they are generating whatever output was satisfactory to Gates — for example, a strong ROI for the year.
On the other hand, if minimum wage advocates insist on paying $15/hour just for the sake of paying $15/hour instead of $7.50, why should they? Why should the employer be forced to take on the extra cost if the output isn’t worth $15/hour, if they aren’t generating that kind of value? Thus, with that kind of imbalance, the employer must make changes in other areas of his business to make it work — whether it be one or more fewer job overall, price increases, etc.
If people aren’t being paid $100,000 because they are not worth it to their company of employment, that’s a part of business. But it is patently unfair to make arbitrary wage increases in the guise of “fairness.” Why is it fair to some but not others? Why are the people earning $500,000 not suddenly getting $600,000 if others making less get arbitrary wage increases? Why are they excluded? Is that fair? That is why such policies are inherently unfair. The employer should be able to determine, on his own, to pay what his employee is worth and what his employee can generate — without artificial wage policies or government coercion.
It’s difficult to own a business and stay in business when the government comes along and makes changes to how the company is allowed to be in business in the middle of the game. That is patently unfair and unequal. These types of actions stifle a business’s freedom to do business, which is why McCloskey’s era of the “Great Enrichment” is proving to be on the decline.
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Earlier this month, the Wall Street Journal noted an incredible sequence of events brought to light through judicial process and undercover emails. Obama meddled in the net-neutrality process, violating standards of conduct. I have reproduced the article in its entirety, as the contents contained therein are rather incredulous:
Congressional committees rarely re-report journalistic exposés, but it’s amazing what information subpoenas can pry loose. A Senate committee has exposed new details on how the White House broke the law to get the Internet regulated as an old-fashioned utility, including emails that show how shocked regulators at the Federal Communications Commission were at the violation of their agency’s independence.
A page-one article in The Wall Street Journal last year detailed an “unusual, secretive effort inside the White House” led by a small group “acting like a parallel version of the FCC itself.” President Obama’s aides thought net neutrality “would help define the president’s legacy” and that along with immigration could be handled by unilateral presidential action. The courts have blocked Mr. Obama’s executive order on immigration, and the Internet regulations should be next to go.
The report, from Republicans on the Senate Committee on Homeland Security and Governmental Affairs, finds that FCC staff worked through a weekend in November 2014 to finalize a plan backed by Chairman Tom Wheeler for light regulation of the Internet. They were shocked on Monday, Nov. 10, when an agency official forwarded a news alert, which she summarized as follows: “Obama says to make it Title II”—the heavy-handed law regulating railroads and the old monopoly phone system.
Staffers then shared a flurry of emails: “Not sure how this will affect the current draft and schedule—but I suspect substantially.” “This might explain our delay.” “It might indeed.” “Will try to get to the bottom of this this morning.” “At least the delays in edits from above now makes [sic] sense.”
Panic struck when it became clear the chairman would cave in to Mr. Obama’s demand and surrender the FCC’s independence. This is a verbatim quote from a draft media Q&A prepared for Mr. Wheeler:
“Q. Has there been discussions between the WH and the FCC leading up to this rollout?
“A. The FCC kept the WH apprised of the process thus far, but there have not been substantive discussions [IS THIS RIGHT?].”
FCC staffers cited nine areas in which the last-minute change violated the Administrative Procedure Act, which requires advance public notice of significant regulatory changes. Agency staffers noted “substantial litigation risk.” A media aide warned: “Need more on why we no longer think record is thin in some places.”
These emails are a step-by-step display of the destruction of the independence of a regulatory agency. The Senate report should make fascinating reading for the federal appellate judges considering whether to invalidate the regulations.
Mr. Obama’s edict resulted in 400 pages of slapdash regulations that the agency’s own chief economist has dismissed as an “economics-free zone.” In the year since Obamanet has been in effect, regulatory uncertainty has led to a collapse in investment in broadband.
Independent regulatory agencies operate in a constitutional gray area, separate from the executive and legislative branches. They have the power to issue broad rules but are unaccountable to voters. The rationale is that agency staffers are experts in the fields they regulate. That justification collapses if they’re subject to political pressure.
In 1983, Ronald Reagan held a single meeting with his FCC chairman on the issue of regulating television rerun revenues. Unlike Mr. Obama, Reagan didn’t have his own staff working on the regulations. And Reagan didn’t express any opinion on the rules—also unlike Mr. Obama, who issued a video promoting utility regulation for the Internet.
Yet Reagan’s modest involvement was headline news. A congressional committee declared he “acted improperly and undermined the fairness and integrity” of the FCC. Sen. Daniel Patrick Moynihan said: “It is imperative for the integrity of all regulatory processes that the president unequivocally declare that he will express no view on the matter.” The Washington Post editorialized: “The danger lies in the kind of chilling signal a certain kind of presidential participation might send to all regulatory agencies about the possible fragility of their independence.”
A 1991 opinion from the Justice Department’s Office of Legal Counsel warns: “White House staff members should avoid even the mere appearance of interest or influence—and the easiest way to do so is to avoid discussing matters pending before the independent regulatory agencies with interested parties and avoid making ex parte contacts with agency personnel.”
The appeals court has plenty of evidence proving White House meddling with a supposedly independent agency. Voters have more reason for outrage at an administration that ignores limits on its power. The Internet is too important to be left to politicians, especially ones who violate the law.
