Relevant and even prescient commentary on news, politics and the economy.

Affirmative Action

CalPundit has a post that largely echoes a conversation I had last night on the subject of whether Affirmative Action leads to promotion and hiring of less qualified people. I said, “sure, you can find instances of it, but you can find instances of hirings of unqualified people for a variety of reasons”. The variety of reasons I had in mind is reflected in the aphorism, “it’s not what you know, it’s who you know”, and in the phrase “old boys network”, and in the practice of legacy admissions and so forth. Because of slavery and Jim Crow, Black Americans have only had a bit less than 40 years to develop legacies and old boys networks and connections, which is a bit less than the 400 or so years white Americans have had. So I said that, on balance, affirmative action is a reasonable counter-balance. If you looked closely enough, I am sure that for every Jayson Blair out there, you could find an instance where affirmative action lead to a minority being hired instead of the boss’s imbecilic nephew.

And for the love of God, somebody please tell me what color Doris Kearns, Steven Ambrose, John Lott, Stephen Glass, Jan Hendrik Schon, and Michael Bellesiles are? I don’t know Bellisiles’ race, but I’m pretty sure the answer on the others is…[pause for some suspense]…white.

And finally, if you are going to argue against affirmative action on the basis of a meritocratic argument, then be consistent and argue against repealing the estate tax (and then using the funds to improve public schools, or for inner city vouchers, or something that levels the playing field).


Browser Stats

For all of you using Netscape v X.x, I assume you are doing so out of some sort of MS protest, or love of the concept of Mozilla. In practice, Mozilla worked out rather poorly; I say, use Opera. When pages let me use it, it’s really the best browser around, in my humble non-techie (but just techie enough to know what Mozilla and Opera are) opinion. In any event, it appears tha Blogger will only let me optimize for one broweser, so based on usage, it’s gotta be MSIE, until I figure out how to make the page more robust. I feel a post about network externalities coming on.


62% Microsoft Internet Explorer 6

18% Netscape 5

8% Microsoft Internet Explorer 5.5

5% Microsoft Internet Explorer 5

2% Microsoft Internet Explorer 5.01

0% Opera 7.03

0% iCab 5

0% Netscape 4.77

0% Netscape 4.78

0% Opera 7.1

0% Konqueror 5

0% Netscape 4.76

0% Netscape 4.79

0% Netscape 4.61

0% Opera 7.02

0% Opera 6.04

0% Microsoft Internet Explorer 4.01

0% Netscape 4.7

0% Microsoft Internet Explorer 4.5

0% Netscape 4.73

Hey, Angry Bear, Why are you so Angry?

Generally, I’m not, but right now I can’t get this #!@!#@! blog to fit into the correct width. So tomorrow (when I have broadband access) I have to redo the template. Until then it looks like you have use the horizontal scroll bar. Just to really make me angry, when I post the template into my HTML editor, it looks fine. When I have blogger publish the page and then I view the source and paste that into my HTML editor, it becomes too wide.


UPDATE: And, as you can see below, someone keeps posting that there’s no text box in the comments, but when I click on “comment” (in both IE and Opera, but I haven’t tried Netscape), it works fine…Please email me and describe the problem and your browser and I’ll work on the issue. And if you can see the text box in the comments, could you indicate that by leaving a comment to this post? Thanks.

Wax On

Via Martin Stabe, a link to another Waxman ProductionTM, this one a report on how much Bush and members of his cabinet stand to gain if the Dividend tax is repealed, from which I extracted this table (click here for a larger graph):

For those still unclear on the concept, add a line saying “you” with “Estimated Dividends and Capital Gains” ranging from 0 to $400 and “Estimated Tax Savings” ranging from $0-$100. Remember, only dividend income held outside of IRAs counts because IRAs are tax-sheltered. If the Grassley $500 exclusion were instead adopted, all the cabinet members would save about $150, though Spencer Abraham and Ann Venemen might get somewhat less. The $500 plan puts the benefits to the Bush cabinet roughly on par with the benefits for the “you” category (where “you” means anyone making less than a few hundred thousand dollars a year). That must be why it appears unlikely to emerge from the conference committee.



I’ve gone from “Adorable Little Rodent” to “Maurading Marsupial” on N.Z. Bear’s blogsphere rating system (To see it, go there, hit CTRL-f and then type “angry bear”)! Sure, it’s a little bit biased due to my participation in ISTE because whenever I post there and refer back to Angry Bear, it counts as an inbound link to Angry Bear (but only for as long as the link is on the front page, I think). At the same time, there are a lot of genuine new linkers as well. Now if I could get readers to use the comments more often. In honor of the return of Ted “Reciprocity” Barlow, the new linkers that I spotted are:

I haven’t had time to check all these out, but thanks for the links.


UPDATE: And I made number 9 on Technorati’s current “Top 100 Interesting Newcomers” list. This list doesn’t count links, as NZ Bear’s does, but rather uses a model that compares new links to existing links so that a blog with a low number of cumulative links but a high number of new links gets a big score (This doesn’t imply that NZ Bear’s algorithm is wrong, just that he’s measuring something different). As David from Technorati explains,

What the ranking algorithms described above does is make it progressively harder to move up in ranking as the number of current inbound blogs increases. This effectively negates the power law that Clay describes, and gives us a way of measuring apples to apples.

Basically, the idea is that for a relatively obscure blogger who has, say, 40 people currently linking to his blog, getting 4 or 5 new blogs linking to him can have the same effect as a a-list blogger getting 40 or 50 new links.

Intuitively, we know that this is right – After all, it’s very easy for Doc Searls to get 20 new links to him – he has such a large readership. But for a smaller blogger to get a bunch of new links, he must have posted something really interesting that day.

The Times Scandal

7,238 words ripping into the former Times reporter Jayson Blair for pulling the wool over their eyes for five years. Now, if they would just take a look back to 1999 and 2000, especially Frank Bruni. But I guess that overt servility and sycophancy don’t violate journalistic ethics.


A Little Perspective

The president pushed so hard to pass at least $550b in tax cats that Democrats will surely claim victory when the tax cut likely comes in at $350b (down from an original proposal of $726b). When they do, keep in mind that that even at $350b, it will be the third largest in history, on top of the largest in history in 2001.

Also, as the NYT story explains, even a bill that only costs $350b will only hit that number via the disengenuous practice of built in sunsets. For example, if you’re worried about paying estate taxes, be sure to die on or before 12/31/2010, as that’s when the estate tax repeal expires. (2010 and 2011 will provide a great test of the extent to which economic incentives to affect behavior). Building the 2010 sunsets into the 2001 tax cut allowed the Bush administration to cite only 9 years of costs as the “10-year cost of the tax cut”. (I don’t have the link on hand, but Somerby’s got a bunch of incomparable posts on this subject). Look for more of the same from the conference committee as the final bill takes shape.

And did I say that Grassley’s $500 dividend income exclusion proposal was pretty reasonable? (Yes, I did, in a post called “Credit Where it’s Due“). Now, as further proof that I was right and it is a reasonable proposal, there’s the fact that Republicans found a tax cut they don’t love:

The bill that came out of the Finance Committee would exclude from taxes each year the first $500 in dividends an investor receives and exclude part of dividends above $500 — 10 percent through 2007 and 20 percent thereafter.

This is too paltry to affect the economy or the stock market and would be of little help to the wealthy investors in the Republican camp. So Republican senators say they will try to expand the exclusion in amendments on the Senate floor. If they do not succeed next week, it is unlikely they will fare better when the bill comes out of conference.

The message appears to be that any tax cut has to be big and really skewed upwards or forget it


Angry Bear is Now Fully Justified!

I should leave it at that, but I’m actually referring to the slightly new look of Angry Bear, including fully justified text and a new right-hand sidebar where someday I may start asking you to buy stuff or give me money.

If you visited late Friday night or early Saturday morning, you may have seen some weird stuff, but it seems to be under control now.


More on the Distribution of Benefits

Just for comparison, the following chart shows the average benefit for the bottom 80%, the median benefit for the bottom 80%, and the benefit for the top 1%, under Bush’s plan and under Grassley’s plan. As you can see, Grassley’s plan isn’t progressive, per se, but compared to Bush’s proposal, it’s a plan Eugene Debs could endorse. (click here for a larger, more legible, graph).

Note how I had to add the labels indicating the savings for the median tax payer in the bottom 80%–without the labels, you can’t even see it.


UPDATE: I should clarify that the $2.50 median figure is a best guess that is much more likely to be zero. All other numbers are real–derived from the Waxman report, the CNN report on Grassley, and some algebra. How did I get $2.50? For the first time ever, in 2001 the number of stock holders exceeded the number of non-stock holders. So a bit more than half of the U.S. population now owns stocks, meaning that 40-something percent do not own stocks and therefore do not receive dividend income at all and thus have a (direct) benefit of zero from a dividend tax cut. The median of the 0% to 80% range is the 40th percentile of the overall income distribution. If stock ownership increased one-to-one with income, then the median benefit would be zero. But then I figured that some (but a distinct minority) of the 40th percentile (income of $33,314) might hold a few shares of the biggies, ATT, Coke, GE, and the like, so I guessed that dividend income would average out to about $2.50 (averaging a bunch of zeroes, and a few numbers in the hundreds of dollars and then multiplying by the 20% tax rate for that bracket).

More on the Dividend Tax Cut

The picture first appeared in Henry Waxman’s study of Bush’s proposed dividend tax cut, then appeared on gorilla-a-gogo, which Off the Cuff then linked and copied, which CalPundit then also posted ,with attribution. If you still haven’t seen it, here it is (for those unclear on the regressive concept, I’ve identified which bar applies to you, unless you make over $374k per year):

This graph is a great example of why I was earlier able to state with confidence that “[Grassley’s] proposal is not Bush’s plan; it’s just the best he [Bush] can get without Snowe, Voinovich, Collins, and Chafee (Zell Miller can only sell out once). Were Bush’s plan implemented, I assure you it would be regressive.”

How would things look under Grassley’s plan? The rich would get to exclude $500 of dividend income, which would otherwise be taxed at 38.6% (2003 rate), for a savings of $193; the bottom 80% would get an average saving identical to that in Waxman’s graph, $29.50. Even that figure overstates the benefit–the $29.50 stems from a relatively small number of upper middle class (70-80%) getting a benefit well above $29.50 and the majority of the middle and lower class getting 0. Seriously, would it be so hard to identify the mean and the median benefit of the various tax programs? In this case, the median benefit to those in the bottom 80% would be the benefit to the person in the 40th percentile, which I suspect would be very close to zero–maybe $2.50 in tax savings.

Whenever the average of X is well above the median of X, you know that the distribution of X is skewed upward. Suppose you and ten friends are in a room and that the average income in the room is $50k, which is also the median (half make more than $50k, half make less). Now take your wealthiest friend and replace him with Bill Gates, who makes $1 billion per year. The average income becomes $104.5 million, but the median remains unchanged at $50 thousand. More to come.


P.S. Why all the emphasis on attribution? See the previous post.