You are browsing the archive for 2013 April 17.

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Lew Rockwell interviews Shawn Ritenour

April 17, 2013 in Economics

By Mark Thornton

I have found that when teaching economic principles it is important to raise questions concerning the ethical implications of those principles, the free market, and government intervention. It not only stirs the interest of students, it also helps drive home the intended lessons. In this interview, Shawn Ritenour and Lew Rockwell discuss the role of ethical considerations and why Christians who ignore the principles of economics, do so to the peril of their own faith.

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Shut Down Kaesong, South Korea

April 17, 2013 in Economics

By Doug Bandow

Doug Bandow

There are many ways to characterize the North Korean government. Chutzpah and ungrateful come to mind. Especially regarding the South Korean-financed Kaesong Industrial Complex. The North has suspended operations there; Seoul should close the zone.

Construction on Kaesong commenced a decade ago. It was part of the so-called Sunshine Policy, an attempt by the Republic of Korea to bribe Pyongyang into behaving better. The ROK government provided money, food, and fertilizer. South Korean companies provided investments, salaries, and goods. There was nothing wrong with the idea in principle. After decades of a fighting a cold war sometimes turned hot, Seoul hoped to encourage detente with its northern antagonist.

Unfortunately, the policy failed. Although bilateral trade hit a record last year of almost $2 billion, political relations have cratered. With the so-called Democratic People’s Republic of Korea apparently determined to make normal ties between the two Koreas impossible, the ROK should demonstrate that it, too, can play tough. In Kaesong, Seoul should bring its nationals home, shutter its factories, and cut off its funds. No more cash while the DPRK threatens to incinerate its benefactor.

Dancing To Kim’s Tune

Hopes were high for KIC when it opened in December 2004. Southern firms spent some $845 million on the facility, in which 123 companies now employ fifty-three thousand North Koreans. However, original plans envisioned adding hundreds of additional enterprises and ultimately employing seven hundred thousand people, around 3 percent of the North’s population. Even today Pyongyang collects tens of millions of dollars in taxes, rents and salaries. The latter alone runs $90 million annually.

The North’s threat to close Kaesong offers Seoul an excellent opportunity to respond with toughness without risking military conflict.”

The DPRK never has been a good host. Four years ago it unilaterally scrapped rent and wage agreements, demanding massive increases, and briefly prevented South Koreans from leaving. After a North Korean minisub sank an ROK naval vessel in 2010, the North closed KIC’s Consultative Office. Earlier this month Pyongyang barred access to South Koreans, which forced some companies to stop operations. Then the Kim Jong-un government kept its workers home, closing the rest of the factories.

The North claimed that it “gets few economic benefits from the zone, while the South side largely benefits from it.” Pyongyang announced plans to “examine the issue whether it will allow [KIC’s] existence or close it.” Indeed, the facility would “cease to …read more
Source: OP-EDS

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Thursday Is Tax Freedom Day

April 17, 2013 in Economics

By Doug Bandow

Doug Bandow

Most of us think of April 15 as “tax day,” but, of course, that doesn’t end our tax agony. Tax Freedom Day comes three days later, when the average American has stopped working to pay his taxes and starts working for himself and his family.

Even that isn’t the end for many. Actor Wesley Snipes was just released from prison after serving two years for “forgetting” to file federal returns from 1999 to 2001. He now has to pay Uncle Sam $7 million in back taxes and penalties. Ouch!

Most Americans don’t end up as federal inmates. But they still spend nearly a third of the year working just for government at some level. The Tax Foundation figured we will pay $4.22 trillion in taxes this year, which is 29.4 percent of our collective incomes.

It’s worse in high tax states. In Connecticut residents work nearly another month, to May 13. New Yorkers “only” labor until May 6. Live in New Jersey and your Tax Freedom Day is May 4. Massachusetts, where the American Revolution began, and Illinois are next at a pitiful April 25. California’s Tax Freedom Day is April 24.

Minnesota follows at April 23. Maryland, which plans to tax the rain (technically “impervious surfaces,” such as driveways, which promote rain run-off) comes in two days later, at April 21. Virginia’s Patrick Henry may have demanded liberty or death, but his state is among America’s worst with Tax Freedom Day on April 20. Washington State, Washington, D.C., and Wisconsin share the same day. Residents of Rhode Island and West Virginia stop paying on April 19.

We live in taxing times in which you never really stop paying.”

If you want low taxes you should head south. Tax Freedom Day falls on March 29 in Louisiana and Mississippi. Tennessee is on April 2. New Mexico and South Carolina are on April 3.

Tax Freedom Day is up five days over last year because of the “fiscal cliff” deal which raised tax rates on high earners and payroll tax rates on everyone. That is painful, but equally bad is wild borrowing to fund ever-increasing government spending. Uncle Sam borrowed some $5 trillion over the last four years, which will have to be paid for some day by someone. Even this year, in the midst of supposed budget austerity, the deficit is expected to run $845 billion.

Unfortunately, borrowing that sum is …read more
Source: OP-EDS

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Why Not Teacher Evaluations by Students?

April 17, 2013 in Economics

By Nat Hentoff

Nat Hentoff

As clashes continue between teachers’ unions and local and state legislatures concerning evaluations of teachers to determine if they are to stay employed, I don’t hear either side reacting to what students feel about how they are being taught. This includes the students themselves.

Such evaluations could and should ask students what they think being in school is going to mean for their futures. Teachers have their missions. But what are these students’ missions beyond college degrees?

Accordingly, to get teacher evaluations, students ought to reveal more about their own real-life, real-time selves in a preparatory dialogue with the people recording their judgments. These people should ask the students such questions as:

  • What do you most want to learn about, and why?
  • Have any of your teachers gotten you interested, even excited about subjects or issues you hadn’t previously thought about? If any did, how did they do that?
  • How well do your teachers know each of you outside of class?
  • What do you care about and do outside of this school?
  • What was your life like before you ever came to school?

I would urge the people talking to the students to ask them to read the teacher-challenging advice Education Week Teacher’s teaching coach David Ginsburg offers (“Assess All Students Before Assisting Any Students,” Ginsburg, June 4, 2011).

He evaluates teachers at work by “when you can see sooner rather than later what students are struggling with and why they’re struggling with it. It’s only then that you can provide timely, differentiated feedback and remediation.”

What happens in many schools, Ginsburg points out, is that “teachers often miss the chance to do this because they’re assisting a few students at the expense of assessing all students. At the end of typical math lessons, for example, teachers assign practice problems for students to try on their own … They then promptly help the first student whose hand shoots up. After two, three and sometimes five or more minutes, they finally move on to another student.

“Many students, meanwhile, sit idly as they wait their turn for the teacher’s help. Some call out until the teacher signals or says, ‘One minute.’ Others raise their hands for several minutes, switching arms every so often to avoid fatigue. But eventually the bell rings or kids give up — and often act up.

“And because they never get the help they need with class work, they’re unable to successfully complete homework.”

I ask you, the readers, …read more
Source: OP-EDS

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Obama's Damaging Admission

April 17, 2013 in Economics

By Michael F. Cannon

Michael F. Cannon

Buried deep within President Obama’s $3.77 trillion budget is a tiny little proposal to increase Medicaid spending by $360 million. In a budget as large as this one, $360 million is scarcely worth mentioning. It amounts to less than one-hundredth of one percent of total outlays. But this 0.01 percent is worth mentioning, because it proves the president’s health-care law will not work.

While many uninsured patients pay their medical bills, the Medicaid program offers “disproportionate share hospital” payments to hospitals that treat lots of patients who don’t.

The president’s Patient Protection and Affordable Care Act cuts Medicaid’s DSH payments, beginning with a $360 million cut in 2014. The theory went like this: When the PPACA begins reducing the number of uninsured, hospitals won’t need those subsidies. In his budget, however, President Obama proposes to increase Medicaid DSH payments by $360 million in 2014, effectively rescinding next year’s cut. This deceptively small item has far-reaching significance. With this proposal, President Obama has admitted that:

1. The PPACA is not likely to reduce uncompensated care in 2014.

A central argument in favor of the PPACA was that it would end the “hidden tax” that uninsured individuals impose on the insured.

Supporters claimed that hospitals shift the cost of treating the uninsured to private insurers, which increases premiums for a typical family by more than $1,000 — a wild overestimate, but I digress. They argued that the PPACA’s Medicaid expansion and health-insurance “exchanges” would extend coverage to some 30 million previously uninsured people, thereby eliminating that hidden tax and enabling Congress to reduce DSH payments.

An item totaling 0.01 percent of the budget proves that Obamacare won’t work.”

The president’s budget shows that not even he buys that argument now. It states: “To better align DSH payments with expected levels of uncompensated care, the Budget proposes to begin the reductions in 2015, instead of 2014.” That is, the president expects that the Medicaid and exchange subsidies won’t eliminate that $360 million of uncompensated care next year. And it’s not because some states are choosing not to expand Medicaid — he proposes to rescind the cuts even in states that are expanding it.

2. The PPACA won’t reduce the deficit.

Rescinding the DSH cuts demonstrates why the health-care law’s supposed “deficit reduction” is a mirage.

Washington has a bipartisan tradition of overspending in the current …read more
Source: OP-EDS