Even The Onion knows more about the Economy than the GOP

http://www.theonion.com/articles/gop-completely-fixes-economy-by-canceling-funding,19897/

Education and Transportation, or lack thereof

Warren Buffett makes it rain!  Read on to see why I posted a picture of  Buffett...

I was reading the Star Tribune, and I saw a few articles that caught my attention.  On the same page of the paper, there was an article about how the Republican-dominated MN Legislature wants to cut the state's higher education budget and the K-12 and Pre-kindergarten budget. (Sidenote: The higher ed bill is sponsored by Michelle Fishbach, no relation to Michelle Bachman.  What is it with this state and people named Michelle bach-something?)  Now, this was not in today's people, but these same Republicans also also want to cut funding for public transportation.

Never mind that the wage gap between educated and uneducated workers is increasing.  Never mind that education in schools is supposed to prepare the next generation of workers.  Never mind that early education provides the highest return on investment of any public spending.  Never mind that the University of Minnesota's research helped create Minnesota's thriving Medical devices industry.  Never mind that public transportation system allows people to get to work and contribute to the economy - and is in fact supported by businesses!  No, these things aren't important, right?

Republicans say that cuts such as these are necessary to close the state's $5.1 Billion deficit.  Horse shit.  What we need to do is reform the tax code so that the wealthy pay their fair share.  By his own admission, Warren Buffett pays a lower percentage of his income in taxes than his secretary does.  Buffett even bet $1 MILLION that no Fortune 500 CEO pays a higher percent of their income in taxes than their receptionist.  So far no one's taken his bet.  And over in New York, billionaire residents of a luxury building pay more than their janitors.

Why does this happen, you ask?  Well for starters, much of wealthy people's income is capital gains, which is taxed at 15% no matter how much money they make.  In addition, hedge fund managers are often allowed to defer their income, allowing them to earn compound interest on his money before paying taxes.  Don't ask me why on that one.  Rich people like Buffett also can take advantage of all the deductions in our tax code - mortgage interest, business travel, etc.  In addition, though Federal Income tax is generally progressive, state and local taxes are heavily regressive - the poor pay a much higher % of their income on sales and other local taxes.

Well, that was a long post, but if you're confused just remember this:

We can afford and must provide good public education and transport services - we just need billionaires to pay their fair share of taxes!

Economics in the News: Economics Behaves Badly?

I've decided to do a series called Economics in the News to keep whoever is reading this blog (probably no one right now) posted on current economic events/thought.  Today's post is responding to the article Economics Behaving Badly by George Loewenstein and Peter Ubel that ran in the New York times on Wednesday.  Read the full post for a summary of this article and my reaction to it.