March 2008 Archives

America's capital markets are losing ground to foreign competition due to excessive expense and regulation.

The United States received only 6.9 percent of the funds raised in global initial public offerings in 2007 and did not participate in any of the top 20 global IPOs, Harvard Law School Professor Hal Scott said at the U.S. Chamber of Commerce's second annual capital markets conference.

"We found U.S. public markets had increasingly become uncompetitive," said Scott, director of the private-sector Committee on Capital Markets Regulation.

In comparison, in 2000, about half of the value of global IPOs was raised in the United States, according to Scott's committee.

Scott also noted that many foreign companies in 2007 took advantage of a U.S. regulatory change that let them delist from U.S. exchanges. About 15 percent of U.S.-listed foreign companies left the U.S. markets in 2007, about three times the historical rate, he said.

We need to ease regulations and cut taxes, or businesses will go elsewhere. That's capitalism. If we keep moving towards greater regulation and government meddling, we're going to end up on the losing end of economic history.

(HT: John Rutledge.)

Several years ago I wrote a short series of posts about our society's despicable tolerance of prison rape, and this editorial by Ezra Klein presents a good opportunity to raise the matter again: "There's nothing funny about prison rape".

These hearings are held annually. This year's transcripts aren't online yet, but in 2006 you could have heard a man named Clinton explain, "I had no choice but to enter into a relationship with another inmate in my dorm in order to keep the rest of them off of me. In exchange for his protection from other inmates, I had to be with him sexually any time he demanded it. It was so humiliating, and I often cried silently at night in my bed ... but dealing with one is better than having 10 or more men demanding sex from you at any given time."

Clinton's testimony wasn't very funny, and it wasn't for entertainment. Nor was the 2001 report by Human Rights Watch, "No Escape," which included a letter from an inmate confessing that "I have no more feelings physically. I have been raped by up to five black men and two white men at a time. I've had knifes at my head and throat. I had fought and been beat so hard that I didn't ever think I'd see straight again."

Prison rape occupies a fairly odd space in our culture. It is, all at once, a cherished source of humor, a tacitly accepted form of punishment and a broadly understood human rights abuse. We pass legislation called the Prison Rape Elimination Act at the same time that we produce films meant to explore the funny side of inmate sexual brutality.

If we as a culture really want to subject our criminals to this sort of torture then let's do it explicitly, not with a wink and a nudge. I'm abstractly in favor of corporal punishment, but this sort of sexual abuse is clearly beyond the pale and should be loudly condemned and quickly eliminated.

I just had this idea, but it looks like other people thought of it last year: carbon offset credit cards.

Industrial giant General Electric (GE) last week introduced a new credit card that encourages consumers to offset the greenhouse gas emissions caused by their spending through the purchase of carbon offsets with reward points. The GE Money Earth Rewards Platinum MasterCard allows cardholders to put a one percent cash rebate on purchases towards projects that help mitigate global warming.

It's brilliant! Instead of giving customers the 1% back that they've come to expect from credit cards, con them into paying it back to you to "offset carbon"!

“It’s ironic,” says Michael J. Brune of the nonprofit Rainforest Action Network. “GE supplies parts for coal-fired plants, so its credit card offsets emissions it helps create.”

Ironic genius! And anyway, Brune makes it sound like emitting carbon is an issue of morality that cannot be offset by the perpetrator -- such as a bank robber who gives part of his loot to an orphanage. But that can't be the case with carbon offsets can it? Is GE's offsetting any more "ironic" than Al Gore offsetting his private plane flights?

Modern Mechanix has posted a great bit about a "Unique Bus of Future to Duplicate Speed of Railroads". You've got to see the picture.

RECENT developments in everything that moves has caused many flights of imagination. Thus the fancy conjures up a bus to keep pace with other transportation. The bus between New York and San Francisco will be equipped with airplanes for trips not on the regular schedule. For diversion, billiard rooms, swimming pool, dancing floor and a bridle path would be available. The pilot would be “enthroned” over his engines, with the radio above. Space for autos would be afforded by the deck.

There's no source given, so I assume it's recently made-up and not a real historical proposal.

Progressive Insurance has ponied up $10 million to sponsor the Automotive X PRIZE. Awesome! Here's Progressive's explanation of the competition.

The Progressive Automotive X PRIZE is a multiyear competition in which $10 million in prize money will be awarded to teams that design clean, production capable vehicles that meet all of the following requirements:

• Exceed 100 mpge or the equivalent (Some cars might not be fueled strictly by gasoline, so they would need to produce a gasoline equivalent of 100 mpge.).
• Meet strict emission requirements.
• Can compete in rigorous stage races that test real-world driving conditions.
• Be safe, affordable, and desirable.

I love the prize paradigm for encouraging research, and it's great to see an Evil Corporation like Progressive make this of leap of faith. I hope they get a lot of recognition and respect for it.

Universal, a writer at the Democrat site MyDD, has posted a hypothetical television ad that would completely annihilate any chance Obama has of winning the presidency. There's some very strong imagery, so if you decide to watch it be prepared.

Honestly, I don't see this ad as being particularly unfair.

(HT: Instapundit.)

"Earth Hour" is a post-civilizational effort to make a mockery of human progress and ingenuity by encouraging people to sit around in the dark and ruminate on the despoiling of our planet, et cetera. To honor this repulsive nonsense, I'm going to leave all my lights on all night -- I call it "Light Night". Feel free to join me if you're so inclined.

Despite my earlier assurances, some scientists (?) think the Large Hadron Collider may destroy the planet.

The world’s physicists have spent 14 years and $8 billion building the Large Hadron Collider, in which the colliding protons will recreate energies and conditions last seen a trillionth of a second after the Big Bang. Researchers will sift the debris from these primordial recreations for clues to the nature of mass and new forces and symmetries of nature.

But Walter L. Wagner and Luis Sancho contend that scientists at the European Center for Nuclear Research, or CERN, have played down the chances that the collider could produce, among other horrors, a tiny black hole, which, they say, could eat the Earth. Or it could spit out something called a “strangelet” that would convert our planet to a shrunken dense dead lump of something called “strange matter.” Their suit also says CERN has failed to provide an environmental impact statement as required under the National Environmental Policy Act.

If there ever were alien civilizations in the universe, maybe the reason we don't see any evidence of them is that they all destroyed themselves with dangerous supercolliders!

Tax Prof notes that in addition to being stingy, the Obamas aren't saving for retirement.

Several bloggers have note another curious fact about Barack Obama's tax returns: despite over $1.6 million in Schedule C income, most of it from royalties on his book, he did not take the elemental tax planning step of establishing a SEP-IRA. The tax magic is that you can shelter up to 25% of your self-employment income (up to $180,000 in 2007), and the investment earnings accumlate tax-free until withdrawn at retirement. Greg Mankiw (Harvard) suggests possible reasons that Obama did not do this:

Maybe he is getting bad tax advice. Or maybe he is expecting vastly higher tax rates in the future when the accumulated savings will need to be withdrawn and taxed. As Obama economic adviser Austan Goolsbee has written, "Future increases in tax rates potentially threaten to significantly reduce the value of your retirement savings and may even mean that you should not save in 401(k) accounts at all."

Great news.

Update:

The Obamas don't own stock either. Wow, these people either have zero foresight, or they know something we don't....

Despite massive outpourings of money over the past decades, AT&T's CEO Randall Stephenson says America's secondary education system is a failure.

Stephenson said he is especially distressed that in some U.S. communities and among certain groups, the high school dropout rate is as high as 50 percent.

"If I had a business that half the product we turned out was defective or you couldn't put into the marketplace, I would shut that business down," he said.

Gone are the days when AT&T and other U.S. companies had to hire locally, he said.

"We're able to do new product engineering in Bangalore as easily as we're able to do it in Austin, Texas," he said, referring to the Indian city where many international companies have "outsourced" technical and customer support workers.

"I know you don't like hearing that, but that's the way it is," he said.

The problem with American secondary education isn't a lack of funding, it's a lack of teaching. Not teachers -- we've got plenty of those, it's just too bad they apparently aren't capable of doing their jobs effectively. I think most of the blame lies with the teachers' unions' commitment to their own power at the expense of our students. They've created a culture in which the purpose of public education is to create union jobs rather than to actually educate children.

Although Iraq's past collaborations with terrorist groups like al Qaeda are difficult to completely discern, it looks like Saddam Hussein's connections to leftist United States congressmen are easier to track.

Saddam Hussein's intelligence agency secretly financed a trip to Iraq for three U.S. lawmakers during the run-up to the U.S.-led invasion, federal prosecutors said Wednesday.

The three anti-war Democrats made the trip in October 2002, while the Bush administration was trying to persuade Congress to authorize military action against Iraq. While traveling, they called for a diplomatic solution.

Prosecutors say that trip was arranged by Muthanna Al-Hanooti, a Michigan charity official, who was charged Wednesday with setting up the junket at the behest of Saddam's regime. Iraqi intelligence officials allegedly paid for the trip through an intermediary and rewarded Al-Hanooti with 2 million barrels of Iraqi oil.

The lawmakers are not named in the indictment but the dates correspond to a trip by Democratic Reps. Jim McDermott of Washington, David Bonior of Michigan and Mike Thompson of California. None was charged and Justice Department spokesman Dean Boyd said investigators "have no information whatsoever" any of them knew the trip was underwritten by Saddam.

"Obviously, we didn't know it at the time," McDermott spokesman Michael DeCesare said Wednesday. "The trip was to see the plight of the Iraqi children. That's the only reason we went."

Obviously! We're supposed to believe that these congresscritters were smart enough get elected to national office but were completely unaware of who paid for their trip to Iraq in the run-up to our invasion. What's more, we're supposed to believe that these vermin didn't knowingly use their public offices to lend legitimacy to the murderous tyrant Saddam Hussein. It's just a coincidence! It's all so obvious!

British men, who once ruled the world, are now whining about feeling emasculated.

Asked what it meant to be a man in the 21st century, more than half thought society was turning them into "waxed and coiffed metrosexuals", and 52 per cent say they had to live according to women's rules.

What they apparently want is what some American academics have dubbed a "menaissance" - a return to manliness, where figures such as Sir Winston Churchill were models of manhood. ...

Men said they "felt handcuffed" by political correctness - only 33 per cent felt they could speak freely and say what they thought, whereas two thirds found it safer and to conceal their opinions.

Men have the power to reverse this trend by simple force-of-will. If men would stop responding negatively to other men who say politically incorrect things, the whole charade would quickly disintegrate. Sure, we'd get clucked at by women, but c'mon. We're stronger, smarter, and control the vast majority of the world's wealth. If our only response to the feminization of society is to whine, then dude, the game is over.

It seems that leftists are only with taxpayer money, not their own personal wealth.

Democratic presidential candidate Barack Obama and his wife Michelle gave $10,772 of the $1.2 million they earned from 2000 through 2004 to charities, or less than 1 percent, according to tax returns for those years released today by his campaign.

The Obamas increased the amount they gave to charity when their income rose in 2005 and 2006 after the Illinois senator published a bestselling book. The $137,622 they gave over those two years amounted to more than 5 percent of their $2.6 million income.

Bill Burton, a campaign spokesman, said the Obamas gave as much as they could afford. He also said the Obamas gave $240,000 to charity in 2007, though they have yet to make last year's tax returns public.

My wife and I make a lot less money than the Obamas, so I'm surprised to learn that we give away a lot more. I guess it's just a difference in priorities. Leftists prefer to tax others to fund their generosity, while conservatives are willing to give their own wealth away. It sure makes Barack Obama's lectures on "hope" a little less palatable, doesn't it? Put your money -- not mine -- where your mouth is, Senator.

The fact that he decided to give more away when his candidacy for the presidency became serious makes him look worse, not better.

(HT: Political Punch.)

Benjamin Franklin famously advised that "a penny saved is a penny earned", meaning that reducing expenses has the same effect as increasing earnings. It's often easier to save a penny than to earn one, so the aphorism is a useful reminder to us all to be careful with our spending.

Fortunately for Ben Franklin, however, he didn't have to pay income taxes! With today's marginal rates, every penny you save can be equivalent to a penny-and-a-half in earnings! All the more reason to practice frugality.

Here's something that's been nagging me that I can't find with Google: what's the history of "free refills" at American fast-food chains? Restaurants more generally?

I have a recollection that Subway was the first place to offer free refills, but I can't remember when it started. I think I was old enough to desperately prefer Subway over other restaurants because of the "free refills" policy, and I remember other fast-food joints quickly following suit.

Did sit-down restaurants always offer free refills of soft drinks, or did they come after the fast-food "free refill"? Is my memory that the "free refill" phenomenon began with Subway correct? Does anyone know what year it was?

"Most Awesomely Bad Military Patches". I find it hard to believe that some of them are real.

With the feminization of our culture I think we're losing an appreciation for some of the male-oriented social skills that have helped propel Western civilization to the dominant world position we presently enjoy; perhaps chief among those skills is the art of intimidation. (That's a pay link, but I recommend reading the whole article.) Everywhere you turn is another fuzzy feel-good message about how we all need to be nice and get along, but the fact of the matter is that male-dominated social structures naturally coalesce around strong leaders, and strong leaders rely on intimidation to drive their followers. And that's not necessarily a bad thing.

Zander and Weinstein are examples of what I call great intimidators. They are not averse to causing a ruckus, nor are they above using a few public whippings and ceremonial hangings to get attention. And they’re in good company.A list of great intimidators would read a bit like a business leadership hall of fame: Sandy Weill, Rupert Murdoch, Andy Grove, Carly Fiorina, Larry Ellison, and Steve Jobs would be just a few of the names on it. These leaders seem to relish the chaos they create because, in their minds, it’s constructive. Time is short, the stakes are high, and the measures required are draconian.

But make no mistake – the great intimidators are not your typical bullies. If you’re just a bully, it’s all about humiliating others in an effort to make yourself feel good. Something very different is going on with the great intimidators. To be sure, they aren’t above engaging in a little bullying to get their way.With them, however, the motivating factor isn’t ego or gratuitous humiliation; it’s vision. The great intimidators see a possible path through the thicket, and they’re impatient to clear it. They chafe at impediments, even those that are human. They don’t suffer from doubt or timidity. They’ve got a disdain for constraints imposed by others.

The modus operandi of great intimidators runs counter to a lot of our most deeply entrenched preconceptions about what it means to be a good leader these days. We’ve all read the books and articles describing people who lead quietly and with great empathy and humility. But as you’ll see, the leaders I’ve been studying think and work in an entirely different way: They’re rough, loud, and in your face.

Beneath their tough exteriors and sharp edges, however, are some genuine, deep insights into human motivation and organizational behavior. Indeed, these leaders possess what I call political intelligence, a distinctive and powerful form of leader intelligence that’s been largely ignored by management theorists and practitioners. In all our recent enchantment with social intelligence and soft power, we’ve overlooked the kinds of skills leaders need to bring about transformation in cases of tremendous resistance or inertia. It’s precisely in such situations, I’d like to propose, that the political intelligence of the intimidating leader is called for.

The article expresses in very clear terms a concept I started to recognize in my later years of high school. Intimidating behavior doesn't come naturally to me, but I've tried to develop my abilities in this area and have found that a little bit of intimidation applied at the right time can often work wonders in business and social relationships. The flip side is that once you learn to use the power of intimidation it's very hard not to apply it in situations where it's not appropriate, such as on friends and family.

I also would never want to be (or be perceived to be) a bully, so that undermines my utilization of intimidation techniques. Most of the time I'd rather stay friends than make every effort to push a group towards an efficient or productive end, so intimidation certainly isn't the only tool in my social toolbox. Being an effective leader in a family, church, or group of friends where the primary reward to the group members is a positive social interaction is a much more difficult balancing act than leading a business that's paying its employees to get some job done. I'm far from perfect at this (as my wife will attest) but I'm working very hard to increase my experience.

First off, let me say that I think it's silly for corporations to pay taxes at all. Why not just tax income when the shareholders of a corporation take out their profit as dividends? Taxing corporate profit and then taxing dividends again for individuals isn't fair, because you're taxing the same money twice on the same people. Anyway, it would be a lot simpler to just combine all the taxes together.

That said, the Tax Foundation has released a new report showing that corporate tax rates in America are among the highest in the world, and there's no doubt that our high rates are pushing jobs and businesses out of the country.

A new study from the Tax Foundation, a nonpartisan tax research group in Washington, shows that most American states tax job providers at a higher rate than any other country in the developed world.

"This is startling news for America's businesses and workers," said Tax Foundation president Scott Hodge, the study's author. "Tax competition for jobs and investment is fierce, and the U.S. continues to fall further and further behind. Our states should be the world's leaders in many things, but high taxation should not be one of them. The high federal corporate tax rate is literally crushing states' competitive abilities. That means fewer jobs for American workers."

Counting the federal rate alone, the U.S. has the world's highest corporate tax rate, but including average sub-national rates (federal plus state in the U.S.), Japan edges out the U.S. for the highest-tax location (see table).

This new study breaks the tax down state-by-state, adding each state's corporate tax rate to the federal corporate tax rate. The results show that 24 states impose, when combined with the federal rate, a higher business tax rate than in any other nation. In fact:

* 24 states have a combined corporate tax rate higher than top-ranked Japan.
* 32 states have a combined corporate tax rate higher than third-ranked Germany.
* 46 states have a combined corporate tax rate higher than fourth-ranked Canada.
* All 50 states have a combined corporate tax rate higher than fifth-ranked France.

As I said though, to be properly considered you need to combine corporate tax rates with individual tax rates. My intuition tells me that if you add corporate tax rates to our individual tax rates, the sum would be lower than the similar sum for the various other countries mentioned. (I have no numbers on hand to back this up.)

Hope everyone is having a good time celebrating the resurrection of Jesus Christ. Despite what many professing Christians focus on these days, Christ's resurrection is really the cornerstone of our beliefs.

Acts 2:29-39

"Brothers, I can tell you confidently that the patriarch David died and was buried, and his tomb is here to this day. But he was a prophet and knew that God had promised him on oath that he would place one of his descendants on his throne. Seeing what was ahead, he spoke of the resurrection of the Christ, that he was not abandoned to the grave, nor did his body see decay. God has raised this Jesus to life, and we are all witnesses of the fact. Exalted to the right hand of God, he has received from the Father the promised Holy Spirit and has poured out what you now see and hear. For David did not ascend to heaven, and yet he said,

" 'The Lord said to my Lord: "Sit at my right hand until I make your enemies a footstool for your feet." '

"Therefore let all Israel be assured of this: God has made this Jesus, whom you crucified, both Lord and Christ."

When the people heard this, they were cut to the heart and said to Peter and the other apostles, "Brothers, what shall we do?"

Peter replied, "Repent and be baptized, every one of you, in the name of Jesus Christ for the forgiveness of your sins. And you will receive the gift of the Holy Spirit. The promise is for you and your children and for a