The 25 richest comedians (or why not to go into standup comedy) from @randal_olson randalolson.com/2015/03/04/top… http://t.co/cp3lSnuPOf—
Tyler Vigen (@TylerVigen) March 17, 2015
Why do these top 0.1 percenters get a pass from the Occupied Movement and Twitter Left?
15 Jun 2015 Leave a comment
in applied welfare economics, economics of media and culture, income redistribution, movies, politics - USA, poverty and inequality, Public Choice, TV shows Tags: comedy, Left-wing hypocrisy, Leftover Left, Occupy Wall Street, top 1%, Twitter left
The ridiculous non-candidate charade in presidential primary elections
15 Jun 2015 Leave a comment
in economics of media and culture, economics of regulation, politics - USA, Public Choice Tags: 2016 presidential election, campaign finance regulation, offsetting behaviour, The fatal conceit, The pretence to knowledge, unintended consequences
Would a referendum on euthanasia pass in New Zealand?
14 Jun 2015 Leave a comment
in constitutional political economy, economics of crime, politics - New Zealand, Public Choice Tags: advance directives, Blackstone's ratio, Citizen initiated referendum, death with dignity, direct democracy, euthanasia, referendums, representative democracy, right to life, rule of law, William Blackstone
A New Zealand First MP along with his populist leader have proposed that the morally tricky question of euthanasia be addressed in New Zealand by a referendum rather than by a vote on a private member’s bill in Parliament.
Although about 80% of the public support euthanasia when asked about it in principle, when the 120 members in New Zealand Parliament elected by proportional representation are asked to vote on it in practice with procedures for safeguards, be last time this was tried in 2003 the Bill failed by three votes. The reason why it failed to pass was a substantial number of MPs who voted against the bill was reservations about abuse.
A badly drafted bill may offer insufficient assurances to some MPs about preventing abuse and ensuring people who are depressed are not offered options that are not in their best interests.
Others have moral or religious objections. The religious objections were summarised by Blackstone, in his Commentaries on the Laws of England, where he wrote that suicide was also a spiritual offence:
…in evading the prerogative of the Almighty, and rushing into his immediate presence uncalled for
If a referendum was to fail, that would make our morally timid MPs even more timid about ever passing a bill on euthanasia.

There is a considerable risk that a referendum on euthanasia will fail because people don’t know exactly what they are voting for. Because of that they will listen to those who opposed euthanasia who will point to the risk of abuse. A referendum strengthens the hands of those that oppose euthanasia. They can play to the lack of detail on what exactly is to be approved.
Many people have very strong views on exactly when and when not euthanasia is permissible because of their views about the sanctity of life and the risk of abuse. The recent High Court judgement on an unsuccessful application are an exception to the criminal law on assisted suicide said that:
The sanctity of human life principle underpins the criminal law relating to culpable homicide. It was said by Blackstone to be the first rule of English law.
When making an exception to the first rule of law, people want to know exactly what they are voting for and exactly what safeguards apply the proposed exceptions. A Referendum does not offer that indispensable option. Writing on a Bill on end of life choice is legally and morally tricky.
Many Bills have failed such as recently in the Scottish Parliament and in 2003 in the New Zealand Parliament because they were badly drafted and were considered by many to offer insufficient protection of the vulnerable against abuse and melancholy.
Even when courts rule favourably on the matter, such as in Canada with its recent Supreme Court decision under its Bill of Rights, that court suspended its judgement upholding the right to euthanasia for 12 month so that the Canadian Parliament could work out the ever so vital details by passing a Bill. As the Supreme Court of United Kingdom recently ruled:
… unless the court can be satisfied that any exception to the subsection can be operated in such a way as to generate an acceptably small risk that assistance will be afforded to those vulnerable to pressure to seek to commit suicide, it cannot conclude that the absolute prohibition in the subsection is disproportionate to its legitimate aim.
That is the essence of reservations about end of life choice. Blackstone’s ratio applies to standards of proof in criminal proceedings: it is better that 10 guilty go free than one innocent suffer.
Those with reservations about end of life choice have the same concerns that motivated Blackstone’s ratio. Their reservations are focused on few cases of abuse not justifying the benefits of going gently into that good night by making exceptions from an absolute prohibition under the criminal law against assisted suicide for the terminally ill despite they being of sound mind and independent judgement.

Mises on why economics analysis is so unpopular
14 Jun 2015 Leave a comment
in applied price theory, applied welfare economics, comparative institutional analysis, constitutional political economy, economics of bureaucracy, income redistribution, Ludwig von Mises, Public Choice, rentseeking Tags: antiforeign bias, antimarket bias, expressive voting, green rent seeking, makework bias, NIMBYs, rational ignorance, rational irrationality
Milton Friedman on the essence of the Age of the Worker
13 Jun 2015 Leave a comment
in applied price theory, applied welfare economics, economic growth, economic history, health and safety, income redistribution, industrial organisation, labour economics, labour supply, macroeconomics, Milton Friedman, occupational choice, politics - Australia, politics - New Zealand, politics - USA, Public Choice, rentseeking, unions Tags: competition and monopoly, The Great Enrichment, union power, union wage premium
Why the Women’s World Cup doesn’t harm host city economies the way the Men’s World Cup does
13 Jun 2015 Leave a comment
in rentseeking, sports economics Tags: is of, soccer World Cup, World Cup
The Nordics use optimal tax theory to fund their welfare states
12 Jun 2015 Leave a comment
in applied price theory, economic history, politics - USA, Public Choice, public economics Tags: Denmark, growth of government, Norway, optimal tax theory, Scandinavia, size of government, Sweden, welfare state
Efficient taxes gather more revenue and therefore are capable of funding a larger public sector with less political resistance from groups who are net taxpayers. The so-called neoliberal reforms of the 1980s and 1990s actually saved the welfare state by putting it on a revenue raising structure that provoked less political resistance.
A switch to more efficient taxes through tax reforms allows governments to raise the same amount or larger amount of revenue for the same level of political resistance from taxpayers. This is because less revenue and output is wasted by discouraging labour supply, investment, savings and investment in capital with high marginal rates of tax on narrower tax basis. Everyone gains from converging on more efficient modes redistribution.
The Nordic countries have been on to this application of optimal tax theory to expanding the size of government and the welfare state for a long time. The Nordics have high but flat taxes on labour income, low taxes on business income and a high, broad-based consumption tax be it called a VAT or GST as illustrated by a just published Tax Foundation report.
To begin with, the USA has a smaller government because it relies more income taxes than on consumption taxes.

Governments in Europe switched towards consumption taxes such as the VAT or GST because this allowed them to raise a large amount of revenue with broad-based taxes at low rates. A VAT or GST exempts exports and business to business transactions from taxes so that reduced taxpayer resistance.
Scandinavian income taxes raise much more revenue than in the USA because they are rather flat. That is, they tax most people at these high rates, not just high-income taxpayers. The top tax rate in the Scandinavian countries cuts in at about one and a half times average income or less rather than eight times average income as in the USA.
Flat high tax "How do Scandinavian countries pay for their govt spending?" bit.ly/1KZ7jOs @JimPethokoukis http://t.co/33oRg8Ozqh—
Old Whig (@aClassicLiberal) June 11, 2015
The marginal income tax rates including this top income tax rate cuts in a low level of income is also rather high in the Nordic countries relative to the USA’s top income tax rate with the exception of Norway.

Nonetheless the Nordic countries are alert to not killing the goose that laid the golden egg. Company taxes are relatively low in Scandinavian countries as compared to the USA so that businesses do not flee to other jurisdictions.

Top marginal tax rates on dividends and capital gains are not above-average in the Nordic states but their taxes on less mobile tax bases such as from labour and consumption are much higher.

A large welfare state such as those in the Nordic countries require a significant amount of revenue, so the tax base in these countries must be broad. This also means higher taxes on consumption through the VAT or GST and higher taxes on middle-income taxpayers.
Business taxes are a less reliable source of revenue because of capital flight and disincentives to invest. Thus, the Nordics do not place above-average tax burdens on capital income and focus taxation on labour and consumption.
via Sources of Government Revenue across the OECD, 2015 | Tax Foundation and How Scandinavian Countries Pay for Their Government Spending | Tax Foundation.
Once were British
11 Jun 2015 Leave a comment
in development economics, economic history, law and economics, property rights, Public Choice Tags: age of empires, British empire, British imperialism, colonialism
Territories that were once part of the British Empire http://t.co/4EyAtGRZyJ—
Amazing Maps (@Amazing_Maps) March 15, 2015
How do presidential candidates spend $1 billion?
10 Jun 2015 Leave a comment
in politics - USA, Public Choice Tags: campaign finance regulation, expressive voting, rational ignorance, rational irrationality
Corporate welfare in New Zealand – 2015 budget update
09 Jun 2015 2 Comments
in applied price theory, applied welfare economics, comparative institutional analysis, economics of bureaucracy, industrial organisation, politics - New Zealand, rentseeking, survivor principle Tags: corporate welfare
I have updated my 2014 report on corporate welfare for the 2015 budget. My report was published today by the Taxpayers’ Union.
My key finding was that corporate welfare increased in the 7th budget of the National Party-led Government from $1.178 billion in its 2014 budget to $1.344 billion in the 2015 budget – see figure 1 and table 1.
Figure 1: Corporate welfare, Budgets 2008/09 to 2015/16

Source: New Zealand budget papers, various years.
Table 1: Corporate welfare in Budgets 2008/09 to 2015/16, $million
| 08/09 | 09/10 | 10/11 | 11/12 | 12/13 | 13/14 | 14/15 | 15/16 | |
| Arts, Culture & Heritage |
3 |
11 |
19 |
10 |
29 |
4 |
4 |
42 |
| Commerce and Consumer Affairs |
6 |
6 |
6 |
6 |
7 |
7 |
6 |
7 |
| Communications |
0 |
25 |
39 |
150 |
178 |
205 |
215 |
190 |
| Economic Development |
372 |
419 |
446 |
379 |
332 |
284 |
280 |
297 |
| Finance |
16 |
44 |
3 |
108 |
15 |
210 |
0 |
0 |
| Primary Industries |
700 |
0.3 |
14 |
0.0 |
43 |
65 |
77 |
180 |
| Science and Innovation |
0 |
4 |
0 |
0 |
0 |
112 |
219 |
269 |
| Tourism |
76 |
94 |
119 |
113 |
98 |
124 |
124 |
121 |
| Transport |
578 |
530 |
376 |
510 |
680 |
119 |
255 |
239 |
| Total $million |
1,751 |
1,134 |
1,022 |
1,277 |
1,382 |
1,130 |
1,178 |
1,344 |
Source: New Zealand budget papers, various years.
Corporate welfare has ranged between about $1 billion and $1.4 billion per year in each of the seven budgets presented by the current National-led Government – see Table 1 and Figures 1 and 2.
Figure 2: Corporate welfare, Budgets 08/09 to 15/16 by Vote

Source: New Zealand budget papers, various years; note: Vote Commerce and Consumer Affairs omitted in all years from Figure 2.
The predominant recipient of corporate welfare in this year’s budget, and all of those since 2008 is KiwiRail. Vote Transport accounts for a third of all corporate welfare – see Figures 3 and 4. Vote Economic Development is the next largest source of corporate welfare and accounts for 28% of the total since 2008 – see Figures 3 and 4.
Figure 3: Distribution of total corporate welfare across votes, 2008/09 to 2015/16

Source: New Zealand budget papers, various years.
Figure 4: State-owned enterprise welfare, Vote Transport and Vote Finance (KiwiRail), Budgets 08/09 to 15/16

Source: New Zealand budget papers, various years.
$280 – $450 million in corporate welfare has been under the patronage of the Minister for Economic Development over the last eight budgets – see Figure 5. In this year’s budget, corporate welfare under the Minister’s hand has increased slightly from $280 million to $297 million.
Figure 5: Corporate welfare, Vote Economic Development, Budgets 2008/09 to 2015/16

Source: New Zealand budget papers, various years.
Up until the 2013/14 budget, science and innovation spending was targeted at research that would not find private sponsors because it could not capture the returns from their discoveries – see Figure 6. Figure 6 shows that there is being rapid growth within Vote Science and Innovation of various forms of start-up and commercialisation grants in recent budgets.
Figure 6: Corporate welfare, Vote Science and Innovation, Budgets 08/09 to 15/16

Source: New Zealand budget papers, various years.
Figure 7 shows that the Government is getting back into the business of subsidising agriculture. The Primary Growth Partnership (PGP) is an R&D grants programme for the primary industry sector. There are 18 PGP programmes underway with a funding commitment from government and from industry combining to $708 million by 2017.
Figure 7: Farm welfare, Vote Primary Industries, Budgets 08/09 to 15/16

Source: New Zealand budget papers, various years.
Figure 8 shows that the National Party-led government is a major investor in ultrafast broadband – going where private entrepreneurs fear to tread.
Figure 8: Corporate welfare, Vote Communications, Budgets 08/09 to 15/16

Source: New Zealand budget papers, various years.
The corporate welfare in the Budget 2015 adds about six percentage points to the company tax rate. Should these corporate indulgences should continue or should the company tax rate drop six percentage points?
If that six percentage points on top of the company tax rate was renamed a business subsidies levy, how many businesses would want to pay it rather than developing their own business under much lower company tax rate?
How to argue for doing nothing about global warming when arguing for a climate club enforced by green tariffs!
08 Jun 2015 1 Comment
in environmental economics, global warming, politics - Australia, politics - New Zealand, politics - USA, Public Choice Tags: climate treaties, club goods, free-riders, global warming, green tariffs, international public goods
The best case I’ve seen recently for doing nothing about global warming was put by those arguing with the greatest sincerity and considerable technical skill that the next international climate treaty should be built around a climate club of those that comply with its obligations with green tariffs on those who do not join.
I have long argued that green tariffs are the only reason to do anything about climate change. Much better to collect the revenue ourselves than let it go into the pockets of a foreign taxman.
William Nordhaus has proposed climate clubs as a way of overcoming free riding in international climate negotiations. Specifically, the international climate treaty should authorise members to impose green tariffs on non-members to encourage them to impose their own carbon taxes and carbon emission targets. This has been done before with the Montréal protocol on CFCs. To encourage the phase-out of CFCs countries that did not commit to do so simply could not trade in those goods with members of the club.
via Climate Deal Badly Needs a Big Stick – NYTimes.com.
4%! A 4% global green tariff is all that is necessary under a climate change treaty that proposes that a carbon price of $50 to apply globally! A 4% green tariff is hardly worth worrying about considering tariffs used to be much much higher than that.
Given all the stories of why woe and doom touted out by the climate alarmists, climate salvation and the keys to environmental heaven should cost much more than 4% tax?! Your sins are forgiven for a 4% green tariff! Big problems such as a climate crisis are not solved with a 4% green tariff.
I think this green tariff of 4% is an own goal. It reinforces the clear message from the economics of climate change that global warming is actually a small economic problem not a large one.
For developed countries, global warming will be at most a minor irritant. For developing countries, their best solution and the solution they have most control over is to develop faster and become a developed country.
The British empire was one of the last colonialists out of the block
08 Jun 2015 Leave a comment
in economic history, economics of media and culture, Public Choice, rentseeking Tags: age of empires, British empire, colonialism, imperialism
Rise of private R&D and the fall of public R&D
06 Jun 2015 Leave a comment
in applied price theory, economic history, entrepreneurship, industrial organisation, politics - USA, rentseeking, survivor principle, technological progress Tags: creative destruction, entrepreneurial alertness, private R&D, public R&D, R&D




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