Monthly Archives: November 2015

Flat tax countries: Russia, Mongolia, Hungary

For no obvious reason, many Republicans and some (few) Democrats are fans of the flat tax. That is a fixed percentage tax on every dollar earned with no deductions, or very few. They see the flat tax as better, or more fair, than the progressive, graduated tax found in the US and most industrial countries. While most Republicans don’t like high taxes, as in Sweden, France, or in the UK, the flat-taxers want a single tax rate: a constant percentage for all. A common version is what Ben Carson described earlier this month, “if you earn ten million dollars your tax will be one million; if you earn ten dollars, your tax will be one dollar.” Herman Caine (R) proposed something similar eight years ago, and (surprisingly) so did Jerry Brown (D).

Ben Carson proposes a 10% flat tax. I'm guessing his source is the Bible.

Ben Carson proposes a 10% flat tax.

As it happens, of the 230 nations on the planet, several already have a flat income tax, and none of them are industrial juggernauts. I will list the larger of these countries in order their tax rate: Mongolia and Kazakhstan, 10% flat tax and hardly any services; Russia and Bolivia, 13% flat tax: moribund, raw-material-based, police-states; Romania and Hungary 16%; Lithuania and Georgia 20%; Zambia 22%; Switzerland, 35% when you include the Cantonal and municipal flat rates, and (topping the list) Greenland at 45%. Not one of these is a productive, industrial powerhouse, like the US, and there is no indication that this will change any time soon.

I suspect that the flat tax enters the minds of conservatives from the Bible, from the 10% of grain that was given to the Levites (Numb. 18:24), and the second 10% eaten of pilgrimage festivals or given to the poor (Deut. 14:22-24). If that’s the source, let me suggest a better modern version is to give out cans of food, or to support ones church. But as a model for government finance, I’d suggest it’s best to leave more in the pockets of the poor, and tax more from the rich. Even in Biblical times, the government (king) levied a substantial tax above the 10%s described above.

A measure of tax rate is the percentage of the total GDP that goes to taxes. As things go, our tax rate isn't particularly high.

A measure of tax rate is the percentage of the total GDP that goes to taxes. As things go, our tax rate isn’t particularly high.

A flat tax does not necessarily imply a low tax, either. Greenland’s flat 45% rate is among the highest in the world, and Israel had a 50% flat tax until fairly recently. It’s also worth noting that personal income isn’t the only thing one can tax. Several countries combine moderate personal income rates with high corporate rates (Venezuela, Zambia, Argentina), or add on a high sales tax, or a transaction tax. Herman Caine’s 9-9-9 tax plan included a 9% transaction tax and a 9% federal sales tax that would have gone on top of whatever the state tax would have been. The revenue collected by the 9-9-9 plan would have been no less than we had, but would be, he claimed, simpler. Cain’s flat tax wasn’t even really flat either, as there was an exclusion, an income level below which you were taxed 0%. That is, he was really proposing a two tier system, with a 0% rate at the first tier. Rand Paul seems to favor something similar today.

The two advantages of a flat tax are simplicity, and that it reins in the tendency to tax the rich too much, a tendency found with many liberal alternatives. The maximum tax rate was 95% in England under Attlee. Their 95% tax-rate appears in the Beetles’s song, Mr Taxman: “…There’s one for you, nineteen for me; ‘Cause I’m the Taxman.” High rates like this caused the destruction of many UK businesses, and caused The Beetles’s to leave and reincorporate in the Cayman Islands. Bernie Sanders recently proposed a top rate that was nearly as high, 90%, and praised Denmark (60% maximum rate) for its high social services. Sorry to say, Denmark seems to have concluded that their 60% maximum was excessive, and earlier this year reduced their maximum to 47.794%. This is below the maximum US rate if you include New York state and city income taxes. History suggests that if you tax the rich at rates like this, they leave or do other socially unacceptable things, like go black-market. On the other hand, if you tax too little, there is no money for education or basic social services, e.g. for the desperately poor. At one point, I proposed the following version of graduated to negative scheme that manages to provide a floor, a non-excessive top rate, and manages to encourage work at every income level (I’m rather proud of it). And there are other key issues necessary for success, like respect for law, and not having excessive minimum wages or other excess regulations.

Bernie Sanders: tax the rich at 90% of income.

Bernie Sanders: tax the rich at 90%; I doubt this is a good idea.

Whatever the tax structure is, there is probably an optimal average rate and an optimal size for the government sector. I suspect ours is near optimal, but have no real reason to think so (probably just nativism). I’ve found that comparing the US tax rates to other countries’ is very difficult, too. Most countries have a substantial Value Added Tax (VAT), that is a tax applied to all purchases including labor, but we do not. Some countries have import taxes (Tariffs, I’m in favor of them), while we have hardly any. And many countries tax corporate profits (and sales) at rates above 60% (France taxes them at 66.6%). To make any sort-of comparison, I’ve divided the total tax income of several countries by the country’s GDP (I got my data here). This percent is shown in the chart above. The US looks pretty average, though a little on the low side for an industrial nation: just where I like to see it.

Robert E. Buxbaum, November 29, 2015. I imagine myself to be a centrist, since all of my opinions make sense to me. When I change my mind on something, I stay at the center, but the center moves. If this subject interests you,  seems to have dedicated his life to following the flat tax.

Disney’s Star Wars seven: muppets in space

I just bought tickets for opening night of the new Star Wars movie, “The force Awakens,” now produced by Disney instead of Lucas Film. While the original films were not family unfriendly, Disney has a peculiar wholesome reputation to uphold and a peculiar taste for cross marketing. As Disney now owns the Muppets, too, and the muppets 30 years ago made some cross-promotional photos with Kermit and Piggy, I now propose the following plot to integrate the photos into the saga as it stands.

We know that the main characters from SW6 (Empire Strikes Back) are back. Harrison Ford appeared on an entertainment magazine wearing a peculiar black vest. I expect to see them on sale, as the Indiana Jones hat was on sale, and maybe still is (I nearly bought one). In a preview he’s shown handing a blaster to a young girl dressed vaguely like a Jedi. My guess is this is an orphan he’s found, and that she’s going to become a Jedi. Han’s personality never changes in the earlier movies, and neither did Leah’s, so my expectation is they’re still the same here. I see Leah leading the free rebels, making pompous comments about uncle Luke, or about the kids (I expect they have at least one child). Han remains a grumpy fly-boy, with perhaps some depreciating humor about his age. I expect Leah to plan the winning air battle, and expect Han to pick the kids up at the end of the movie, and to fly off in the old Millennium Falcon station as the credits roll. Han and Leah are not main characters; mostly there for reference and continuity.

This is a meme on Facebook, don't know who did it, but clearly relevant to Star Wars 7.

I saw this on Facebook; don’t know who did it.

In the preview, the girl enters a wrecked star ship and hears a voice saying, “who are you?” The girl answers “nobody.” I’ll guess this is a new female companion, who is, like the girl a castaway. All the key people enter Star Wars as castaways of one sort or another (Han, Luke, Chewie, Obiwan, Yoda, Anakin, Qui Gon, Jar Jar Binks…) It’s a pattern found with the baby Moses, or the young Oedipus found by Polybus. Finding such castaways is rarely good luck for the finder’s clan. As the castaway is unseen, I’ll assume it’s a certain muppet, a voluptuous pig who dresses like Leah. We’ll call her Lola. My guess is that Luke will be taken by her. Is it love? Can Luke be true to her and to the force? The Ghost of Yoda will appear to claim she’s trouble, and will remind them that control of feelings is of utmost importance. (Yoda’s a creeper, as was Obi Wan: teaches emotion control and pacifism; helps Luke blow up a death star).

The previews also show a handsome black ex-storm trooper, perhaps he’ll be a love interest for the girl, and perhaps the next generation of Jedi: the force has to awaken in someone. Either way, he too is a castaway. There’s also a bad guy in black. I don’t expect another castaway, so I’ll guess this finally is the biological son of Han and Leah, and that he’s the first student of Luke.

I see a new love interest: Lola, the she pig. Can she be trusted? Can Luke keep true to her and to The Force?

I see a new love interest: Lola, the she pig. Can she be trusted? Can Luke be true to her and The Force?

The bad guy is shown at the head of an army of Imperial storm troopers. He’s been turned bad, perhaps by the skull of Vader? Luke, dressed in black, is still on the good side and will try to teach the girl and storm-trooper, dressed in white, but without much success. He’s lost his nerve. Someone is shown in black, with a cross- shaped light-saber; my guess is it’s Luke. Disney would not put a cross in the hands of a villain (just saying). The red cross shape flickers suggests anguish. My guess is there is a foreshadowing that Luke will eventually perform an act of self-sacrifice, like Christ or Obi Wan; can’t let the cat out of the bag.

Not knowing otherwise, I’ll assume that the ex-storm trooper is the McGuffin, or has it. It’s he that attracts the bad guys. He conveniently crash-lands on a desert planet where we also find Han, the mystery girl, and the mystery pig (the force is strong with him). Perhaps he’s been turned to the good side by the mystery pig. The Empire attacks and Han takes them all to the Rebel base where we meet Leah and Luke. Luke sees something in the trio and (I’ll guess) takes them to Degoba, the planet where Luke was trained. Why? Luke won’t say. I picked Degoba because that’s where the muppet shoot was. I expect one robot to go, and the other robot to stay behind with Han and Leah. Robots always accompany people in SW, like valets.

I expect Luke’s ship to be blown up on Degoba, stranding them. They get stranded in every movie, so why not. But who did it: Luke? Lola? One of the kids? Something’s not kosher about the pig. Is she a sith with a snout (say that five times fast). I imagine Luke teaching the kids some Jedi stuff, but growing frustrated. He tells them to control their feelings; that fear leads to hate, etc. His niece will say she’s already heard that from Yoda, and will add, What are you doing with the pig? Don’t you see the danger? Luke will try to explain: “You’ll understand when you’re older,” and will walk off with the pig into the woods.

Star Wars, green with envy.

You make me feel like I’m 500 again, but my place is with Kermie. It’s another awkward family reunion photo.

The kids will meet another green, wise one. A frog, named Kermit, who will train them using music and laughter. The kids will then try to explore the woods with Kermit in tow.

Meanwhile Luke, will fire up his cross-shaped light saber and raise up a hoard of dark assistants (or assassins?). Who are they? They are phantasms of Luke’s wayward student, and of other’s he’s injured. Luke will fight a phantasm and kill it; again it’s himself. The girl will show up and he’ll nearly kill her, but Lola will stop them, and tell Luke not to feel bad about the bad guy, his student.

The ghost of Yoda appears, and Lola says, “It’s about time, sonny-boy..”  Yoda will say, “Yes, mommy.” Luke says, “She’s your mother?!”. Lola will look up at Luke and say, “yes, and a very troublesome lad he’s been. “He’s told you all wrong about feelings. “Feelings are good.” The ex-storm trooper and the girl look at each other. Lola will look at Luke and say, “you make me feel like I’m 500 again, but my place is with Kermie.” Kermit  looks lovingly at Yoda.

There’s a space attack from the Empire. Rescuers appear, with Han at the lead in the falcon. The two youths turn out to be excellent flyers. Everyone flies off. Inside the ship, Lola turns to Kermis, “Feelings, Kermie, I’ve been in that prison ship for 800 years, get behind the seats, and I’ll show you feelings.”… Kermis makes a face. Han hits the hyper drive. Ship vanishes, Music swells, and the credits roll.

Buxbaum, Yes, that’s a winning combination script, written. November 23, 2015.

A day of thanksgiving during the civil war

At the height of the civil war, Abraham Lincoln proclaimed a day of thanksgiving for the last Thursday of November, 1863. It’s the first time Thanksgiving was proclaimed for the date we now keep every year. The war was not going well. The Union defeat at Chickamauga, Sept. 19-20 1863, left 35,000 dead, the bloodiest two days in US history. Most citizens would have called for a day of fasting and prayer, but in Lincoln’s view, things were good, and there was a need for joy and thanksgiving:

“to thank the Almighty God” …for.. “the blessings of fruitful fields and healthful skies… “for peace that…. “has been preserved with all nations.” [That] “harmony has prevailed everywhere except in the theatre of military conflict….  “a day of Thanksgiving and Praise to our beneficent Father who dwelleth in the Heavens”…. and for … “the care all those who have become widows, orphans, mourners or sufferers in the lamentable civil strife.”  (see the whole proclamation here.)

A Civil War Thanksgiving. It's fellowship that makes peace possible.

A Civil War Thanksgiving. It’s fellowship that makes peace possible.

His was an interesting view, as important then as now. There is a need to remember that the good we have is more than the bad, and that there is a source of the good. As of today (2015) the economy is good in Michigan and the US. We are at peace with our neighbors and have civil obedience in our streets; we have food on our tables and clothes on our backs. We have cleaner air and cleaner water than in decades, blue skies, and plentiful rain. The ozone hole has shrunk, and global warming seems to have stopped. We have so much food that hardly anyone in our country suffers starvation, but only the hunger for finer, fancy things. We have roads without bandits, lighting at the flip of a switch, water at the turn of a tap, indoor heat, and (for most) indoor cooling in the summer. We have telephone communication, and radio, and television, and music at our fingertips. We have libraries with books, and free childhood education. We have a voice in our government, and information from the far ends of the earth. All these call for joy and thanksgiving.

And we can even find a cause for thanks in the things we don’t have: space travel and the diseases we can’t cure, for example. The things we don’t have provide a reason to wake up in the morning, and a motivation to do great things. We live in a country where we can change things, and it’s nice to know there are things worth changing. For ideas that lack expression, we can provide it. For diseases, we can still search for a cure. For those who lack happiness and friendship, we can help provide both (a joyful celebration is a good occasion to do so). For those who lack a job, we can help. And to those who feel a lack of meaning in life, perhaps the best answer is a celebration to explore the source of all blessings. Let us reach out to “all those who have become widows, orphans, mourners or sufferers.” A lesson Scrooge learned from the ghosts is that joy and generous celebration are self-sustaining and attractive. Let joy and good fellowship extend to all. God Bless us each and every one.

Robert Buxbaum, Detroit, November 18, 2015, The anniversary of Lincoln’s Gettysburg address is tomorrow, Nov. 19th (it wasn’t well received). As for Black Friday shopping, lets not get up from the table of thanks to jostle each other for some useless trinket.

Sept. 11, 1683, Islam attacks Vienna.

In the US, September 11 is mostly known for the attacks on the World Trade Center, 2001. But world wide, I think, it’s mostly known for the Battle of Vienna, 1683. Based on his interpretation the religious command to take over the corrupt western world, the Dar al-Harab, for the world of Islāmic peace, the Dar al-Islam, Caliph Mohamed IV, broke the Treaty of Vasvár in 1682, and sent his army to attack Vienna, something Suleiman the Magnificent had tried in 1526. They besieged the city and attacked unsuccessfully on September 11, 1683, a day that would live in infamy.

The forces of Mohamet IV surround Vienna, September 11, 1683.

The forces of the Caliph surround Vienna, the city of good wine, September, 1683.

Mohamed IV’s army was 150,000 strong, led by Grand Vizier, Kara Mustafa Pasha. The army spent a year getting to the city while they conquered, or subdued Rumania, Bulgaria, Serbia, Croatia, and Hungary. During that year, Emperor Leopold I and Charles V, Duke of Lorraine left Vienna nearly defenseless, and scoured Europe for allies. Vienna was left defended by just 24,000 under command of Ernst Rüdiger von Starhemberg. By the time Kara Mustafa arrived Leopold had gotten a pledge of financial support from the pope, and signed a mutual defense treaty with the Polish-Lithuanian League, and with Saxony, Baden, Bavaria, Swabia and Franconia, a good years’ work (Louis XIII of France said no).

Kara Mustafa reached Vienna on July 14 1683, but did not attack. Instead he laid siege to the city, and to nearby Perchtoldsdorf (Petersdorf). Perchtoldsdorf surrendered, but Vienna did not. Kara Mustafa then massacred the entire Christian population, perhaps as many as 30,000 people in the city square, and took their booty. This move may have pleased the Caliph, but did nothing to encourage the Viennese to surrender. Vienna held out until September, 1683 when the liberating armies of Leopold, Charles V, and John III Sobieski (Poland) arrived. Kara Mustafa attacked on September 11, but it was too late. In the counter attack, the Islamic army was defeated and put to flight. Kara Mustafa was put to death by the caliph for his failure.

Cavalry fighting at the Battle of Vienna, 1683

The Polish cavalry at the Battle of Vienna, 1683

The loss at Vienna was the beginning of a long retreat for Islam. Over the next century, Hapsburg rulers captured Romania, Bulgaria, and Hungary; Russia conquered the Ukraine. The victorious Viennese built churches, established a feast day (Day of the Holy Name), and created crescent-shaped rolls, breads in the shape of the Moslem crescent symbol (or so the legend goes).

My reading suggests that, to this day, believing Moslems find the churches, breads, and festival offensive at some level. My guess, too, is that Osama bin Laden picked September 11, 2001 as his response to the offense. As a teen, Osama traveled in Europe, and his bookshelf included, “The Rise and Fall of the Great Powers (Paul Kennedy)”, and similar titles suggesting he would have known about the date and its significance. It seems likely (to me), that the date of the US embassy attack in Benghazi, Libya, September 11 2012 was similarly planned to match the earlier Sept 11’s, and not, as Ms Clinton claims, a response to a Jewish-made, Hollywood film.

It is clear that not every Islāmic thinker understands the obligation to battle our Dar al Harab to be one of armies, swords, and bombs. Even the Ayatollah Ali Khamenei has explained that the popular slogan, “Death to America,” does not mean “death to the American people,” but “death to U.S. policies and arrogance,” That is, a war of ideas. He claims this struggle is “backed by reason and wisdom,” i.e. by the Koran, and he should know.

"Muslims against Crusaders" chanting during the two minutes of Remembrance Day (Armistice Day) silence, 2010.

“Muslims against Crusaders” chanting during the two minutes of Remembrance Day (Armistice Day) silence, 2010, “Our soldiers are in paradise, yours burn in Hell.”

However it is fought, the aim of the war is fought for our benefit: to save us from eternal Hell, and make our present world better, a part of the Dar al Islam, the Moslem world of religious peace. Even at our best, our infidel Dar al-Harab is considered evil because we go about independently competing in a world of chaotic commerce. Each infidel (as they see it) trying to wrest wealth from his fellow in an economic struggle that can only be ended by Caliphate-controlled charity. That the Dar al-Islam has been in turmoil for the last 1000 years is considered a slight embarrassment. To me, it seems more like Aesop’s fable of the toad physician who could not heal himself.

I note that many religions have the same jaundiced view of commerce, and have fought over it. What I find somewhat humorous (ha ha) is that Islam = Sholom = peace, and that there is a pattern of war being used to enforce peace on the unwilling.

If you find errors in my thinking, please tell me; I’m an engineer, not a historian or a theologian (Islāmic or otherwise). What little I know of Islam comes from my meagre translation above, from some history, and from public comments, e.g. by Ayatollah Ali Khamenei. Just so you know my biases, my sense is that a world of economic chaos is a better, more satisfying world, than any world of statist religious rule. I’d say that G-d likes entropy in all its forms, and that chaos is a gift. Let us thank God for Wine (Wiine = Wein = Vienna).

Robert E. Buxbaum, Friday, November 13, 2015.

The boon of e-cigarettes

E-cigarette use is rising fast among US smokers, and have passed traditional cigarette smoking among US High Schoolers, according to a recent CDC surveyAmong the advantages: e-cigarettes are less regulated and cheaper than regular cigarettes. The vapors smell better. The smoke is supposed to be 95% less unhealthy. And the vape (e-cigarette “smoke”) doesn’t stain teeth like regular cigarettes. Not everyone is thrilled to see a safer cigarette alternative, though. A 2014 Harvard Study, The E-cigarette Quandary, points out that 95% less dangerous is not the same as 100%, that kids might come to smoke who might not otherwise, and that one could still get unwelcome, second-hand nicotine from exhaled vape. To correct these issues, some 200 regulation and prohibition bills have been introduced in 40 states in the past year alone. Among these, prohibitions on selling to minors, prohibitions on vaping where smoking is prohibited, and a National Park Service prohibition on e-cigarette use anywhere in a national park. 

Inside an e-cigarette

Inside an e-cigarette

My sense is that, for some people, those who already smoke, a 95% less dangerous alternative has got to be a boon, unless (as seems unlikely) people come to smoke twenty times more e-cigarettes than regular. To the contrary, It appears that e-cigarettes seem to help smokers quit tobacco, even with no help from a smoking cessation service. And over time, e-smokers tend to reduce the amount of nicotine in the juice, in that way reducing the toxic burden of the e-cigarette too. This is an option that is not possible with traditional, combustion cigarettes.

The claim that e-cigarettes are 95% less harmful than combustion cigarettes is based on a comparison between the concentrations of poisonous vapors inhaled, as measured for a study published in the journal, Addiction. Sorry to say, you have to pay to read the whole article, but you can read the abstract for free, or read a blog post by the lead author, Dr. Konstantinos Farsalinos. A British study supports this too, as described in a more-recent report by Public Health England. While it is not 100% clear that a 95% reduction in harmful vapor means that e-cigarettes are 95% less dangerous, that would seem to be the conclusion on a puff-per-puff basis, assuming no change in the formulation of e-cigarette “juice”, and only if the smokers don’t end up smoking vastly more.

Have e-cigarettes caused  the decrease of regular smoking, or is it a threat to the decrease in regular smoking?

E-cigarette use among US High School students, 2014. The rise in e-cigarette use parallels a decrease regular smoking; perhaps it’s the cause of the decrease. From “The E-cigarette Quandary.”

For the reasons above, I gave an e-cigarette device to an employee who smokes. So far, it seems he likes it, and I’m happy that he doesn’t have to go outside to smoke. It also seems to have saved him some money and his teeth look a bit whiter as best I can tell. Interestingly, he claims he has less of a desire for regular cigarettes, too matching observations among high school use, and among the population in general. My first impression, the e-cigarette seems to be a boon, a good thing, for him at least.

Despite the sense that e-cigarettes are a boon, that sense is rooted in cæteris paribus, the assumption at all else remains static. Without regulations, I expect some nasty developments — in the content of e-cigarette juice, in the operation of the cigarette, and in the product marketing. Nicotine is a drug, cigarette makers are clever, and there is money to be had. I see regulation being needed over the acceptable composition of the juice, over the operating temperatures and flows of the cigarettes, and over sales and advertising to minors. With these put into place, I see no need for further prohibitions on e-cigarettes in the work-places or the national parks — or so it appears to me today.

Dr. Robert E. Buxbaum, November 8, 2015.

Is cannibal tourism good for Michigan?

Governor Snyder has no appetite for it, but ex-governor Jennifer Granholm did, and some of her Democratic colleagues still do. Not cannibal tourism, as such, but movie subsidies paid for by a tax on business property independent of profits. Some seven years ago, in 2008, then-governor Granholm and a majority of our legislature instituted a $132 million/year subsidy program that provided up to 42% of movie production costs. The hope was that films would bring Hollywood-type wealth and glamor, and that they would spark tourism. As it happened, the jobs went to Hollywood transients to such an extent that the total number of MI film employees was reduced. It is now 100 lower than at the start, and virtually all of the money spent went to out-of state employees (quite often the high-priced star) who left as soon as the filming was done. The report concluded that the program returned 11¢ for every tax dollar spent. One of Governor Snyder’s first acts was to diminish the subsidies, and the legislature has just put an end to them: revenge of the nerd.

Offspring, filmed in Michigan. It does not seem to have promoted Michigan tourism.

Offspring: no jobs created, and perhaps no tourism … but think of the cool factor.

The amount spent in the early years, $132 million/year, was about 1/3 of the state’s deficit, a major misuse of funds. Reason magazine claimed it was “stone-crazy” to support movies when the state had, at the time, 14% unemployment, the highest rate in the nation. They argued that the money could be better spent on roads, or schools, or left in folks’ pockets (I agree).

The effect on tourism isn’t quite what was hoped. Movie makers tend to see Michigan as a setting for dystopian films, for example, “Offspring,” a film about cannibal tourism. This film got one of the largest state subsidies. A plot summary is:  “Survivors of a feral flesh-eating clan are chowing their way through the locals.” If this encouraged tourism, it’s not necessarily the tourists you wanted. You can tell it’s Michigan by the Michigan symbol on the police cars. Michigan funds also brought two Batman movies to Detroit, along with Michael Moor’s “Capitalism, a love story“, a  movie billed as showing how capitalism makes life in America a nightmare. The current head of the film board has noted that “realistic cannibalism; the gruesome and graphically violent depiction …. is unlikely to promote tourism in Michigan or to present or reflect Michigan in a positive light.” I can agree.

Batman and Superman in Detroit.

“Batman vs Superman.” They battle in Downtown Detroit, as do “Red Dawn” and “Transformers.”

Opposition to dropping the program came mostly from the Democratic side of the aisle. Rep. Jeremy Moss, D-Southfield, said the film incentives were creating good jobs. Rep. Kristy Pagan, D-Canton, pointed to “… the cool factor. Who doesn’t want to see Ben Affleck or Amy Adams walk down our streets?” (I don’t). In the end, three Democrats and virtually every Republican voted to end the program. Among the Republicans for keeping the program were Kathy Crawford R-Novi, and Mike McCready, R-Birmingham.

You should not feel too bad for the makers of gore films. Subsides are still available in Massachusetts, Oregon, Washington, California, Minnesota, Nevada, and several other states. Massachusetts welcomed Part 2 of The Offspring, a Massachusetts headline proclaimed the victory: “Come to Massachusetts, We Love Cannibals!” Massachusetts folks have been full of themselves for years. As for the money we saved, our Michigan legislature has finally begun balancing the budget and decreasing the destructive personal property tax that helped fund these schemes.

Robert E. Buxbaum, November 5, 2015. I should also commend the legislature for making “talk like a pirate day” a state holiday, and for passing, on November 3, a necessary roads bill. It was signed by most Republicans and two Democrats. Bipartisan-ish. With good management, Michigan might be coming back – lets hope it continues.

Michigan’s road bill — why not?

Stagnating before the Michigan Senate is a road improvement bill that passed the Michigan house 10 days ago. Though it’s not great, I hope they sign the bill. The bill would raise raise $600 million to $1.2 billion/year, an increase of $60 to $120 per person per year ratcheting up over the next six years. The first stage of the bill would take effect in October 2016, and would raise $400 million by increasing our car/ truck registration fees by about 40%. People with normal sedans would pay about $60 more per car per year. Those with more expensive, heavier vehicles would pay more. Though our registration fee is already among the highest in the nation, raising it further has the potential (It seems to me) to be the most fair and reasonable source of additional revenue. People with fancy cars, I imagine, are wealthy and those with heavy cars (I imagine) do the most road damage. This is the part of the bill that has proven the most contentious.

The next stage would begin in early 2018. It would raise $200 million by increasing Michigan diesel and gasoline taxes. The larger part would be on diesel fuel, an increase of 7.3 cents/gal presumably to soak out-of-state truckers who come through Michigan. These individuals deserve extra taxation, I imagine, because they don’t pay registration fees and probably damage our roads even more than those with fancy cars. Besides, they don’t vote in Michigan. The gas tax increase is smaller, 3.3 cents/ gal on regular gas, but Democrats are correct to point out that it is regressive. It takes a greater fraction from the poorer than from the rich. The hope is that, by the time the tax increase takes effect, we’ll have some inflation and also some more fuel-efficient cars so the bite won’t be as bad. Sorry to say, we already pay the 10th highest gas tax in the country.

The final phase of the road funding bill would not take full effect until 2021. The idea is to transfer $600 million from the general fund to pay for the roads with money left over to reduce home-owner taxes. Underlying the ability to do this is an assumption that Michigan industry and home prices will recover enough between now and then that we’ll be able to stop using the gasoline taxes to fund our schools, ideally with money left over from the regular income and sales tax. While I’d like to see this happen, and while this is possible given that the last few years have seen the state’s GDP recover at a 15.5+% growth rate (third highest in the nation) there is also a basis to say the assumptions are over- optimistic. On the other hand, the Democratic plan, based on 1.6% growth next year is likely over-pessimistic. As The Yogi says, “Predictions are always difficult, especially about the future.”

Whatever your views of the future, our roads are crumbling now, and new money is needed to fix them now before they get worse. If taxes must be raised, I’m inclined to do it with use -taxes, that is by charging those who use the services most. This is a philosophical preference of mine. Not all Republicans agree with this, and only one House Democrat has signed on so far. It was the view of the old-time, labor Democrats I grew up with, but not of today’s Democrats who prefer to tax “the rich” for any and all goods and services. Their point: that there are struggling, poor people who drive heavy, expensive cars. They’ve something of a point on the heavy cars, but I have less sympathy for the rest. I wrote a comic story about a poor guy trying to dispose of an expensive car, a Viper. My guess is that struggling rappers and poser politicians would not find it funny.

Dollars per capita spent on roads, 2013. From MDoT's road funding proposal.

Dollars per capita spent on roads, 2013. From MDoT’s road funding proposal.

Part of the way that MDoT (the Michigan Department of Transportation) justified its target of $600 million to $1.2 billion was by comparison with surrounding states — not my favorite way of analysis. The MDoT graphic shows that Michiganians spend about $57 less per capita on roads than folks in Illinois, Wisconsin, or Ohio, and about $100 less than folks in Indiana or Pennsylvania. Multiply $57 by our state’s population, 10 million, and they conclude we should spend some $570 million more per year. Multiply by $100, and you get $1.0 billion.

While the need for at least $600 million/year sounds about right, I note that the per-capita spending justification seems dubious. If you calculate instead on the basis of dollars per lane-mile, as below, you find that Michiganians are already paying more per mile than Minnesota, Wisconsin, or Indiana. You’ll also note that Ohio and Illinois pays about 1 1/2 times as much their roads aren’t much better. A major part of the variation, I suspect, is corruption, and the rest, I guess is incompetence. Illinois, perhaps the most corrupt state in the mid-west, has seen 4 of its past 5 governors go to jail, along with innumerable Chicago Aldermen and lesser officials. Citizens of Illinois pay for this corruption in over-size construction projects, and over-size construction fees. After the $600 million increase, we’ll pay $8,950 per lane mile suggesting we are still not quite as costly per lan-mile as Illinois or Ohio. If it turns out we need the full $1.2 billion extra, it will suggest we are even more incompetent or corrupt than Illinois.

Road funding state by state comparison.

Road funding state by state comparison, from the same MDoT report, 2013.

An ideal way I’d like to reduce the costs of Michigan’s roads would be to reduce corruption, a trend that’s already helped to revitalize Detroit since the Justice department jailed the mayor and his father plus some associates for “pay for play”. I’m sure it also helped to remove the chief of police (millions in his ceiling) and Bobby Ferguson of the useless, expensive Jail project and Guardian building scandal.

Conviceted IL

It’s somewhat hard to judge the level of general incompetence in a state, and even harder to find a fix. Minnesota had a bridge collapse in 2007, and we had the Zilwaukee in 1982 (and 2008), the 9 mile bridge collapse of 2009, and the Southfield overpass collapse of 2014. It’s been proposed that we should be able to fix both our corruption and our incompetence problems by holding the contractors responsible for any failures. If only it were that easy. Holding contractors responsible might get some contractors to allow the concrete cure for longer periods under water before opening a road, but I’m not sure the public would stand for it. A more-likely outcome is that crooked contractors would charge more for the same bad work, and then go bankrupt as soon as the road fails. If their company were appropriately structured, they could re-appear the next day: the same people and equipment, operating under a new corporate name.

The biggest single incompetence issue that I can see appears to be poor under-road drainage. In Oakland county, where I am, the drain department looks responsible for the major flood of last summer. We’ve had rains this big in previous years without this massive flooding. I suspect a lack of dry-wells, but don’t know. From what I see, the drainage is bad beneath many Oakland roads, too. It seems like the concrete slabs are not deteriorating as much as they are coming apart. That’s a sign of bad drainage. I also see sink-holes, new lakes, and places where the sidewalks sink. Again, that’s a sign of bad drainage; a sign there is a swamp near or beneath the road. If the ground below a major road is a swamp, there is no practical way a contractor can build a long-lasting road over it. Until the drains get better, or the corruption subsides, we’re going to have to replace the roads often at a cost of another $600 million/year. We might as well acknowledge our problems and sign the bill.

Robert Buxbaum, November 2-3, 2015. If you feel like getting involved, contact your state senator and tell him/her to vote yes (or no). Our senator is Vince Gregory. And if anyone would like to put me on a drainage board, I’d be happy to serve for free.