Alexandria Ocasio-Cortez: Economic Jugger-Not

Yep. It’s one of those blogs about everyone’s favorite Leftist, Alexandria Ocasio-Cortez. This time, I’m tackling her latest economic idea, raising the marginal tax rate on anyone making over $10 million to 70% of each dollar above that threshold to help fight climate change as part of her Green New Deal.

Leftists are already jumping on board because it combines two of their favorite causes: environmentalism, and socking it to the rich. And, as Leftists are quick to point out, the marginal tax rate was much higher in the 50s and 60s when we had tremendous growth, and Ocasio-Cortez’s suggestion is lower than the marginal tax rates back then. So, it has to be a great idea, right?

Not even close.

The problem is the way her critics are striking back isn’t effective either, as it fails to make a distinction between tax rates and marginal tax rates. I, however, will do my best not to fall into that trap.

Here’s how a marginal tax rate works. There is a threshold set where any income above it gets taxed at a different (and usually higher) rate. You are still being taxed for the income made below the threshold, just not at the higher rate. Under Ocasio-Cortez’s plan, the normal tax rate applies up to $10 million, and then the 70% kicks in at $10,000,000.01. Imagine trying to take 70% of a penny. I’m sure the IRS already has.

This is where critics fail or attempt to deceive people, depending on how much you trust your politicians. Republicans and conservatives insinuate the 70% marginal tax would apply to all income above $10 million, when it only applies to a portion of it. Even so, the same person is being taxed twice for the same income, one at the “regular” rate and one at the higher rate, all because of some arbitrary threshold set by someone who has an economics degree, but can’t tell her assets from a hole in the ground. This is where the argument against Ocasio-Cortez’s idea should start. If you want to throw in that last part about her assets, be my guest.

The key flaw in her idea is it ignores the source of the income from the marginal tax rate: the people making over $10 million a year. Thanks to lobbying, accounting tricks, and tax loopholes big enough to drive a Brinks truck through, it’s entirely possible the only people paying the marginal tax rate are those who do it voluntarily or those who don’t know how to avoid it. And, contrary to Leftist belief, there are a lot more in the latter group than there are in the former.

That may be one of the reasons Ocasio-Cortez is linking this marginal tax rate to her Green New Deal idea. The concept of protecting the planet may guilt more people into paying the tax than might normally do it. Even then, the question becomes what happens to the money. Will it be distributed to tech companies to develop cutting edge green energy technology? Will it be used to incentivize more people to use alternative fuel sources? Or will it just go to environmental subcommittees and organizations with track records of inactivity and/or failure? That’s just it. Nobody knows, least of all the young woman proposing the marginal tax rate. And the Green New Deal initiative is poorly drawn out to the point of being little more than a proposal in search of an action plan. It’s like trying to build a race car by telling people how fast it will go once built. At some point, you’re going to have to learn how to build a car, and right now, Alexandria Ocasio-Cortez doesn’t even have the help of Mr. Horriblewrench, let alone Mr. Goodwrench. But she does have an idea that will throw a wrench into our economy.

Raising the marginal tax rate for any reason when we have evidence of wasteful spending that needs to be addressed is folly and reveals the true intention of Ocasio-Cortez’s idea. It’s not to help the fight against climate change; it’s about taking people’s money all because they committed the great Leftist sin of making it one way or another. And if your rebuttal involves anything resembling “paying their fair share,” let me remind you there are close to half of American adults who pay little to no federal income tax at all. When these folks start paying into the federal coffers more than they’re taking, then we can have this talk.

Leftist Lexicon Word of the Week

I hate to admit it, but Congresswoman-Elect Alexandria Ocasio-Cortez is starting to grow on me. For someone who follows politics so you don’t have to and tries to pepper his commentary with humor, Ms. Ocasio-Cortez is comedy gold!

Among the various ideas she’s tossed around is something called a Green New Deal, and it’s gaining traction among the greener members of the Left. And, like many of the ideas she’s tossed about, it has far-reaching implications…and is poorly thought out and, thus, mockable. So, let’s do that, shall we?

Green New Deal

What the Left thinks it means – a series of initiatives to address ecological and economic crises with the focus on climate change

What it really means – another attempt to grab green while attempting to go green

If the Left ever started a religion (aside from worshiping failed sociopolitical movements and, oh yeah, themselves), it might look a little like the green movement. No matter what happens, it’s attributable to climate change. And don’t you dare bring stuff like real science and facts into the discussion because that just won’t do. We have to believe climate change is real, is getting worse, and only we can stop it.

Come to think of it, that’s pretty much Leftists worshiping themselves. Anyway…

The Green New Deal has a lot of Leftist gated-community-cul-du-sac cred. First off, it’s based in part on Franklin Delano Roosevelt’s New Deal, a series of government programs designed to lift our failing economy during the Great Depression. Second, it combines two of the Left’s favorite causes: the environment, and spending other people’s money. And third, it’s guaranteed to increase the size and scope of government. So, to the Left, it’s a win-win-win proposition!

Now, are you expecting me to pour a glacier’s worth of cold water on this idea? If you said yes, I hope you bet the over because there is a lot wrong with the Green New Deal.

First off, the New Deal wasn’t that great overall. In fairness, it did cut into the unemployment rate a bit, so I will give it credit for that. The problem is it didn’t solve the employment or economic problems nearly as much as we’ve been lead to think it did. When you look at the numbers (and I have since my social calendar is emptier than a strip club in Amish country), the New Deal moved unemployment less than a percent after several years of being introduced. Prices were still high for the time and jobs were mostly scarce, even with the New Deal’s make-work programs.

So, if it wasn’t the New Deal that got us out of the Great Depression, what did? A little thing the kids like to call World War II. After Pearl Harbor, our factories needed to produce goods for the war, which meant a need for people to work, and that meant more jobs to be had. FDR might get the credit from Leftists (and he does), but his programs didn’t accomplish what they set out to do in any significant way. Hopefully, there isn’t a world war that comes after the Green New Deal is put in place, but it might be the only way for it to succeed.

I’ve talked at length about the Left’s green hypocrisy, so I won’t go too much into it here. And if you’ve paid attention to federal budgeting in the past few decades, you know all about how the Left loves to spend other people’s money. I will say, however, many people who push a green agenda also have another ideology behind it: some variation of socialism. That’s not to say all of them are, but after seeing enough of them, I’m starting to think it’s a requirement, not an aberration.

Then, there’s the growth of government. Leftists love this idea because it guarantees jobs for people who wouldn’t otherwise be employed and protects them from being fired for the reasons these people wouldn’t otherwise be employed. I don’t know all of the specifics (because not even the Green New Deal supporters have thought it out yet), but I guarantee there will be overlap with existing government programs. How can I make such a bold prediction? Because there already is overlap, and a lot of it. Take the banking industry, for example. You can count on 2 hands the number of agencies that oversee different banking functions and might even need to take off your shoes and socks these days. And they are all doing the same thing. A Green New Deal will only repeat that process, and it won’t get us any cleaner. Just look at SuperFund.

While going green is an admirable goal, the Left simply can’t make it work without coming up with expensive “fixes” that don’t do anything or creating yet another government agency that will spend more on air travel to climate change conferences than on the actual problem of climate change. But before you think I’m just complaining without an alternative, let me roll out my Green New Deal.

Approach Elon Musk, offer him a sum of money upon completion to solve or at least mitigate the climate change problem, and let him go to work.

That idea will make Leftists’ heads explode, but hear me out. The problem with the green movement is that it doesn’t understand what Musk does: environmentalism isn’t sexy. If you want people to become more environmentally friendly today, you have to create a demand for it. Toyota tried doing this with the Prius, and it’s still limping along while others drive by in SUVs so high you need an air traffic controller whenever you go out for a drive. And a big part of that is the Prius looks like an egg. It’s not attractive, but it does fulfill human need, such as being part of a group and having that group think highly of the Prius owner. But ego alone isn’t enough to save the planet. What’s missing is capitalism.

Musk didn’t become rich and famous by settling for the mediocre. He dreamed big, risked big, and won big with the Tesla and with Space-X. We need that kind of daredevil intellect involved in what the Left considers to be the highest stakes of all with climate change, but the Left doesn’t want a solution; they want a problem they can milk for money, power, and occasional guest spots on CNN and MSNBC.

The fate of the Green New Deal is up in the air right now, but if the past is prologue, we know how the story ends before it even begins. Let’s try something new, a more daring approach.

Do it…for the children.

Leftist Lexicon Word of the Week

If you’ve been watching the Left lately, you’ve probably noticed they’ve been trying to make socialism sexy again. If you haven’t, consider yourselves lucky because…well, they’re trying to make socialism sexy again. What started with the Bern Outs in 2016 has been reborn in 2018 thanks to new Leftist “it girl” Alexandria Ocasio-Cortez beating out a Democrat stalwart in a House race in New York. Granted, both Sanders and Ocasio-Cortez are couching their pro-socialism talk by supporting what they call “democratic socialism”, but it’s still socialism.

As a result, Leftists are putting a new coat of paint on an old ideology in the hopes of attracting new people to their cause. In the meantime, let’s traipse into the world of socialism.

socialism

What the Left thinks it means – a social system where everyone pitches in to help each other

What it really means – a socioeconomic system where everyone is encouraged to be mediocre

One of the Left’s primary talking points when talking about socialism is to try to separate the social element of it from the economic element. For that, they bring up communism as the economic side of socialism, which is of course complete bunk. Socialism and communism are ideological cousins of the kissing variety, if you know what I mean. They really can’t be separated effectively because they have the same basic tenets: government control of all aspects of an economy and its societal counterpart. There are slight differences, I grant you, but those difference revolve around how much force is used to attain the equality they both claim to want to achieve. Socialists tend to rely on a call to community unity, while communists rely on a call to arms. Put another way, socialism is communism on pot, and communism is socialism on PCP.

Even so, socialism is attractive to people because it seems so friendly. Bernie Sanders wasn’t on the stump telling people to tear down the ruling class. He looked too much like your grandpa or crazy uncle you occasionally see at family reunions. Alexandria Ocasio-Cortez doesn’t look like a female Che Guevara; she looks like someone you might have gone to school with or saw in a coffee shop. Even some of our best-known celebrities say socialism is okay, and we can trust celebrities, right?

That’s one of the great historical ironies about socialism. It’s an idea that curries favor with the wealthy, but it’s rarely acted upon by those same people. Socialism is easy if you never intend to be held to its standards, but for those who went along with it and weren’t rich enough to live behind the gilded gates of private communities, it sucks.

And that’s a dirty little secret behind socialism: there is a class structure within it that negates what it stands for. The former Soviet Union is a prime example of this. (And before any Leftists say the Soviets weren’t real socialists, see my earlier comparison of communism and socialism.) Although the average Russian communist was living hand to mouth, government officials had far more luxuries (and, oddly enough, freedoms) than their proletariat brethren. Socialism runs on the same principles as communism and the results are the same. There will always be the haves and have-nots, thus making socialism as realistic as James Comey’s excuses for why he didn’t prosecute Hillary Clinton.

Leftists pushing socialism like to point at Europe and some of our own government programs as proof socialism isn’t scary. Why, we could just look to the Swedish model of socialism and use that (at least according to Bern Outs). The problem? Sweden isn’t really socialist. They are capitalist economically and statist socially, meaning…they’re ultimately capitalist because they have to be. Money doesn’t come out of thin air, and in Sweden it comes from…wait for it…high taxes. The minute the haves decide to move away to a country that doesn’t tax them for being rich, there is no backup plan and their socialism-lite goes the way of Crystal Pepsi and New Coke. For socialism to truly exist, there has to be an income source that can be drawn upon. In other words, socialism doesn’t work unless there is wealth to be distributed.

Then again, socialism doesn’t work, period. But we’ll get to that later.

But what about our government programs, like Medicare and Medicaid? Surely they are examples of socialism working, right? Annnnnnnd no. These programs aren’t actually socialist either because they take mainly from the working class instead of the rich and give to the non-working class and poor. In short, if you put in any significant amount of time at a job, you’re a have. Doesn’t matter if you make the poor on Skid Row look like Bill Gates. You are a source of income to socialists because you have what others don’t.

Really makes you wonder why anyone would back socialism, doesn’t it?

And here’s the kicker. There can never be true socialism because humans aren’t uniform and many have  a desire to excel. Granted, some people want to be good at Xbox, but it’s still a desire that cannot be taken away. When you have that, you will always have people who are better than average and others who are worse than average. Try building a society based around equality when you can’t even find two people who are equal across the board and share the same interests at the same level. You’ll have better luck finding a Kardashian with actual marketable skills.

The way socialism deals with the problem is to treat everyone as though they were exactly the same. It works great if you suck at your job because you get paid as much as the ones who are doing just enough to get by. On the other hand, it sucks if you’re great at your job because you have no incentive to do more than you have to since you’re getting paid the same. That tends to make everyone mediocre at best. It also tends to stop innovation because you aren’t rewarded for it. Capitalism isn’t perfect, but you’re more likely to get rewarded for hard work and being good at a job than you are under socialism.

So, why is socialism so popular today? That’s a good question. I think it’s due to a combination of factors from a lack of historical and economic knowledge to trying to protect kids from experiencing failure by celebrating even minimal effort to making the marginally passable into the excellence of today. (I’m looking at you, Starbucks. Five bucks for coffee made from beans more burnt than my skin after falling asleep on the sun?) At the core of it all, however, is the elevation of laziness as a virtue and the downgrading of excellence to a vice.

No matter whether it’s someone who looks like your grandpa or your college roommate telling you socialism is the wave of the future, remember we’ve tried socialism before in America. It’s called the Mayflower Compact, and it didn’t work out so well for the Pilgrims. And if it didn’t work when there were far fewer people in the country, there’s no way it works with today’s America.