Wintery Knight

…integrating Christian faith and knowledge in the public square

Do tax hikes, welfare spending and minimum wage hikes lower income inequality?

Here’s Heritage Foundation economist Stephen Moore to explain.

He writes:

Massachusetts Sen. Elizabeth Warren recently appeared on one of the late night talk shows, beating the class warfare drum and arguing for billions of dollars in new social programs paid for with higher taxes on millionaires and billionaires. In recent years, though, blue states such as California, Illinois, Delaware, Connecticut, Hawaii, Maryland and Minnesota adopted this very strategy, and they raised taxes on their wealthy residents. How did it work out? Almost all of these states lag behind the national average in growth of jobs and incomes.

So, if income redistribution policies are the solution to shrinking the gap between rich and poor, why do they fail so miserably in the states?

The blue states that try to lift up the poor with high taxes, high welfare benefits, high minimum wages and other Robin Hood policies tend to be the places where the rich end up the richest and the poor the poorest.

California is the prototypical example. It has the highest tax rates of any state. It has very generous welfare benefits. Many of its cities have a high minimum wage. But day after day, the middle class keeps leaving. The wealthy areas such as San Francisco and the Silicon Valley boom. Yet the state has nearly the highest poverty rate in the nation. The Golden State, alas, has become the inequality state.

In a new report called “Rich States, Poor States” that I write each year for the American Legislative Exchange Council with Arthur Laffer and Jonathan Williams, we find that five of the highest-tax blue states in the nation—California, New York, New Jersey, Connecticut and Illinois—lost some 4 million more U.S. residents than entered these states over the last decade. Meanwhile, the big low-tax red states—Texas, Florida, North Carolina, Arizona and Georgia—gained about this many new residents.

What’s wrong? Isn’t raising taxes, growing government and spending more on welfare supposed to make reduce income inequality? Well, the trouble is that you need to think about things from the point of view of the people who create the jobs. People who want to start a business prefer to move to states where they can keep more of the money they earned. So, that’s why there is a mass exodus from states that don’t allow job creators to keep the money they earn. And naturally, they hire workers in their new state once they get there. Eventually people in the high-tax states move to where the jobs are, too.

Stephen Moore has actually measured it:

The least “regressive” tax states [high tax states] had average population growth from 2003 to 2013 that lagged below the national trend. The 10 most highly “regressive” tax states [low tax states], including nine with no state income tax, had population growth on average 4 percent above the U.S. average. Why was that? Because states without income taxes have twice the job growth of states with high tax rates. 

[…]Ohio University economist Richard Vedder and I compared the income gap in states with higher tax rates, higher minimum wages and more welfare benefits with states on the other side of the policy spectrum. There was no evidence that states with these liberal policies had helped the poor much and, in many cases, these states recorded more income inequality than other states as measured by the left’s favorite statistic called the Gini Coefficient.

[…]The 19 states with minimum wages above the $7.25 per hour federal minimum do not have lower income inequality. States with a super minimum wage—such as Connecticut ($9.15), California ($9.00), New York ($8.75), and Vermont ($9.15)—have significantly wider gaps between rich and poor than states without a super minimum wage.

No, I am not an economist, but I think that this is because the real minimum wage is ZERO, and that’s what more people in high minimum wage states make compared to people in low minimum wage states. If Seattle raises the minimum wage to $15 and the workers end up making the real minimum wage (ZERO) because job creators can’t pay them, then naturally the gap between rich and poor increases.

I think it’s always a good idea for people to think about things from the point of view of the small business job creator, and it all makes sense. If you want to get trained in how to do this, I recommend picking up introductory books by economists like Thomas Sowell, Milton Friedman or even F.A. Hayek. The goal here is to achieve good results, not to have good intentions.

Filed under: Commentary, , , , , , , ,

Study: children are safest when they live with their two married biological parents

Marriage is the safest environment for children

Marriage is the safest environment for children

Story from Family Studies.

It says:

Young people are less likely to be victims of crime if they live in two-parent than in single-parent households. That has been a consistent finding of the National Crime Victimization Survey conducted by the U.S. Department of Justice. But it has been unclear whether the safety advantage stems from married couples living in less dangerous neighborhoods, on average, than unmarried parents, or from other differences in vulnerability between family types. My analysis of recent data from another national survey shows that even when their families live in unsafe neighborhoods, children in married two-parent families are less likely to be exposed to violent crime than children of never-married and divorced parents.

In the 2011-2012 National Survey of Children’s Health, conducted by the U.S. National Center for Health Statistics, parents of 95,677 children aged 17 and under were asked whether their child was “ever the victim of violence or witnessed any violence in his or her neighborhood.” Among children living with their married biological parents, the overall rate of exposure to neighborhood violence was comparatively low: for every 1,000 children in intact families, 36 had witnessed or experienced neighborhood violence. By contrast, among children living with a never-married mother, the rate of violent crime exposure was nearly three times higher: 102 children per 1,000 had one or more such experiences. Among children living with a separated or divorced mother, the rate of exposure was more than twice as high as for children of married parents: 89 children per 1,000. (See Figure 1.) These comparisons are adjusted for differences across family types in the average age, sex, and race/ethnicity of the child; family income and poverty status; the parent’s education level; neighborhood quality; and frequency of residential moves.

Some might assume that the absence of an adult male to protect the household is key to the higher victimization rates of single-parent families. Yet children living with a biological parent and a stepparent also had an elevated rate of exposure to neighborhood violence: 84 children per 1,000. Even children living with both biological parents who were cohabiting rather than married had a significantly higher victimization rate—60 children per 1,000—though not as high as those in never-married or divorced families.

[…]Why are children living with never-married or separated and divorced mothers more susceptible to neighborhood violence? Beyond the greater likelihood of having to live in unsafe neighborhoods and the more frequent moves that often come with family disruption, there are several other factors that increase vulnerability. First is the stress of conflict between parents and the strain of raising children as a lone parent in reduced financial circumstances. These can lead to a lack of vigilance and the overlooking of simple precautions, such as making sure that doors and windows are locked in houses and vehicles. Second, if they have broken up with their child’s other parent, a single parent will usually begin dating and trying to find a new partner. This process often involves being out of the house at night, sometimes leaving children with no or inadequate supervision. Third, as children become adolescents, the peers they become involved with in their less-than-ideal neighborhoods and schools are often troubled ones, who can lead them into hazardous situations and activities.

Marriage matters! We can allow alternatives to natural marriage, but natural marriage is best for kids.

You can read more about the safety advantages of marriage for women and children in this Heritage Foundation paper. Marriage matters, and we should doing everything we can to shrink secular big government programs that discourage marriage (e.g. – single mother welfare),  and promote programs that encourage people to marry and have children, (e.g. – getting rid of the marriage penalty). It’s a policy problem – we aren’t doing enough to help children when the secular big government is more interested in making it easier for people to not marry (single mother welfare), and breaking up existing marriages (no-fault divorce laws).

Filed under: Commentary, , , , , , , , , ,

Should blacks vote for Democrats? Do liberal policies help young black men?

I want to quote from two black economists – my two favorite economists – to answer some questions.

First, Thomas Sowell.

Economist Thomas Sowell

Economist Thomas Sowell

Is minimum wage good for young blacks?

He writes:

Low-income minorities are often hardest-hit by the unemployment that follows in the wake of minimum wage laws. The last year when the black unemployment rate was lower than the white unemployment rate was 1930, the year before there was a federal minimum wage law.

The following year, the Davis-Bacon Act of 1931 was passed, requiring minimum wages in the construction industry. This was in response to complaints that construction companies with non-union black construction workers were able to underbid construction companies with unionized white workers (whose unions would not admit blacks).

Looking back over my own life, I realize now how lucky I was when I left home in 1948, at the age of 17, to become self-supporting. The unemployment rate for 16- and 17-year-old blacks at that time was under 10%. Inflation had made the minimum wage law, passed 10 years earlier, irrelevant.

But it was only a matter of time before liberal compassion led to repeated increases in the minimum wage to keep up with inflation. The annual unemployment rate for black teenagers has never been less than 20% in the past 50 years, and has ranged as high as over 50%.

You can check these numbers in a table of official government statistics on page 42 of professor Walter Williams’ book “Race and Economics.”

Incidentally, the black-white gap in unemployment rates for 16-year-olds and 17-year-olds was virtually nonexistent back in 1948. But the black teenage unemployment rate has been more than double that for white teenagers for every year since 1971.

Second, Walter Williams.

Economist Walter Williams

Economist Walter Williams

Is voting for black leaders good for blacks?

He writes:

Black leaders stress the importance of political power and getting out the vote, but we might ask how important political power is to the ordinary black person. As a start toward answering that question, we might examine black life in cities where blacks hold considerable political power.

Detroit is the nation’s most dangerous city. Rounding out Forbes magazine’s 2013 list of the 10 most dangerous cities are Oakland, Calif.; St. Louis; Memphis, Tenn.; Stockton, Calif.; Birmingham, Ala.; Baltimore; Cleveland; Atlanta; and Milwaukee.

According to a recent American Community Survey by the U.S. Census Bureau, the 10 poorest cities with populations of more than 250,000 are Detroit, with 33% of its residents below the poverty line; Buffalo, N.Y., 30%; Cincinnati, 28%; Cleveland, 27%; Miami, 27%; St. Louis, 27%; El Paso, Texas, 26%; Milwaukee, 26%; Philadelphia, 25%; and Newark, N.J., 24%.

In addition to poverty, there is grossly inferior education and high welfare dependency in these cities.

The most common feature of these cities is that for decades, all of them have had Democratic administrations. Some cities — such as Detroit, Buffalo, Newark and Philadelphia — haven’t elected a Republican mayor for more than a half-century.

What’s more is that in most of these cities, blacks have been mayors, chiefs of police, school superintendents and principals, and have dominated city councils.

[…]Let’s be clear about what I am saying and not saying. I am not suggesting that there’s a causal relationship between crime, poverty and squalor on the one hand and Democratic and black political power on the other. Nor am I suggesting that blacks ought to vote Republican.

What I am saying is that if one is strategizing on how to improve the lives of ordinary — and particularly the poorest — black people, he wants to leave off his high-priority to-do list the election of Democrats and black politicians. Also to be left off the to-do list is a civil rights agenda.

Perhaps the biggest roadblock to finding solutions is the widely held vision that the major problem confronting blacks is discrimination. I am not arguing that every vestige of discrimination has been eliminated. I am arguing that the devastating problems facing a large proportion of the black community are not civil rights problems. The solutions will not be found in the political or civil rights arena.

And third, more Walter Williams.

Is focusing on the few cases where a white police officer shoots a black man good for blacks?

He writes:

Excerpt:

Each year, roughly 7,000 blacks are murdered. Ninety-four percent of the time, the murderer is another black person.

According to the Bureau of Justice Statistics, between 1976 and 2011, there were 279,384 black murder victims. Using the 94-percent figure means that 262,621 were murdered by other blacks.

Though blacks are 13 percent of the nation’s population, they account for more than 50 percent of homicide victims. Nationally, the black homicide victimization rate is six times that of whites, and in some cities, it’s 22 times that of whites.

Coupled with being most of the nation’s homicide victims, blacks are most of the victims of violent personal crimes, such as assault and robbery.

The magnitude of this tragic mayhem can be viewed in another light. According to a Tuskegee Institute study, between 1882 and 1968, 3,446 blacks were lynched at the hands of whites. Black fatalities during the Korean War (3,075), Vietnam War (7,243) and all wars since 1980 (8,197) come to 18,515, a number that pales in comparison with black loss of life at home.

It’s a tragic commentary to be able to say that young black males have a greater chance of reaching maturity on the battlefields of Iraq and Afghanistan than on the streets of Philadelphia, Chicago, Detroit, Oakland, Newark and other cities.

Not everyone who runs around crying “racism, racism” is interested in helping blacks to do as well as other racial groups.

Blacks will do well, just as they used to do, when the political parties in power embrace free-market capitalist policies, such as lowering the minimum wage, or scrapping it entirely. Blacks will do well, just as they used to do, when we strengthen and subsidize natural marriage – by repealing no-fault divorce and reforming welfare for single mothers. Blacks will do well, just as they used to do, when we make public schools more responsive to parents, and less responsive to teacher unions. And so on.

Filed under: Commentary, , , , , , , , , , , , , , , , , , , , , ,

Why do liberals constantly talk about sexism, racism, homophobia and so on?

Here is a must-read post from Lindsay, writing at her Lindsay’s Logic blog.

She writes:

Many people don’t notice this, but liberals always speak of people by the group they belong to – African Americans, gays, whites, Hispanics, women, poor people, etc. They talk about the rights of people as a function of belonging to a group – gay rights, women’s rights, etc. They don’t speak of people as just people in general. The liberals are not color blind. Far from it. They are keenly aware of race and gender and other group statuses because they are the ones promoting separate factions and pitting groups against each other for their own ends. If you don’t believe me, just listen to them sometime. They can hardly talk about anything without making it all about special groups. And in the irony of ironies, they have somehow managed to convince a lot of people that it’s the conservatives who are racist and sexist.

Liberals don’t really care about gays or women or children or poor people. They just want votes and to be thought inclusive and tolerant. It’s all part of their image. But they don’t actually want to help anyone or stop hatred. In fact, they’re very good at promoting hatred (especially against Christianity and conservatism) and drumming it up where it doesn’t exist. They survive on the hatred and misunderstanding between groups. They want the country splintered into different groups that all have grudges against each other. That way, they can pretend to commiserate with all the separate groups and promise them help in exchange for votes and money. They need people to be riled up and upset so that they can swoop down with their promises of change and trade people a “government solution” in exchange for their freedom.

How do we know liberals don’t really want to help? Because they don’t actually help. Liberal policies don’t produce good results. They don’t cure poverty or stop racism or protect rights. Their policies are carefully crafted to look good on the surface, but not stop the evils of society, because it is the existence of those evils that keeps everyone coming back to liberals for “solutions.” To cover this failure of their policies, liberals are very good at turning the conversation away from the actual results of their policies and talking instead about all their good motives.

I recommend reading the rest, there’s more nutritious wisdom there.

But I wanted to talk about one of the ways that liberal policies hurt the poor, so we have a concrete example of what she is talking about.

Black marriage rates from 1970

Black marriage rates from 1970

This is a study from the National Center for Policy Analysis. (PDF)

Democrat president Lyndon B. Johson passed a massive program of wealth redistribution in 1964.

Here’s what happened:

President Lyndon B. Johnson declared an “unconditional war on poverty” in 1964 and followed up a year later with an avalanche of domestic social and antipoverty programs known collectively as the Great Society. Johnson persuaded Congress to support his welfare agenda — sending him more than 80 pieces of legislation to sign in a short period of time. Among the plethora of poverty-alleviating Great Society programs were food stamps, Medicare, Medicaid, Head Start, federal educational funding, housing assistance, increased welfare spending and other income transfer programs. The Great Society was intended not only to reduce poverty, but also to better peoples’ lives across the board. Ironically, the Great Society legislation seemed to simultaneously both ignore — and hinder — the most effective antipoverty program: marriage.

Indeed, this “War on Marriage” is a major reason for the lack of progress on poverty over the past 50 years!

[…]And President Obama’s signature piece of legislation — the Affordable Care Act — has only exacerbated federal marriage penalties. The Great Society without Marriage. Marriage has been on the decline for decades.

According to the Pew Research Center:

  • Around 1970, about 84 percent of native-born 30-to-44-year-old adults were married.
  • By 2007, this proportion had fallen by nearly one-third to 60 percent.
  • The marriage rate is even lower for men and women who lack a college degree (56 percent in 2007).

And the marriage rate is even lower still for some racial demographics.

According to Pew:

  • Only one-third of black women ages 30 to 44 were married in 2007, compared to 62 percent in 1970.
  • For black men, the corresponding rates are 44 percent (2007), down from 74 percent in 1970.

Why do more low-to-moderate income couples skip the wedding bells? The reasons are partially economic: Financial penalties in the tax code kick in when couples get married. According to research from the Brookings-Urban Institute Tax Policy Center, the combined marriage penalty is signi?cant for families earning less than $40,000.

The method used to calculate income eligibility and antipoverty programs is the primary culprit: the so-called federal poverty level (FPL). The FPL’s income thresholds are for individuals or families of various sizes, and those with incomes below the FPL are by definition in poverty. The FPL is used to determine both eligibility and the amount of benefits for many different programs.

That’s how the left “helps” the poor, by making it worse, by blaming conservatives, and by demanding higher taxes and more power to redistribute wealth.

This is not even controversial – think tanks on both sides of the political spectrum (e. g. – Brookings Institute, the Heritage Foundation) agree. Marriage is essential to stopping poverty. Period. And the left killed it by taxing it and giving welfare to single mothers by choice, as well as by passing laws like no-fault divorce, which discourage men from marrying because of the punishment they take if there is a frivolous divorce.

Advice for Christians on economics

You can’t be a Christian and just leave your Christianity at the level of Bible study, A. W. Tozer, early Church Fathers, and other spiritual stuff. A person who reads the Bible and focuses on having a “heart for God” and being “godly” and spending all their time reading devotions and doing Bible study is not going to be able to do what the Bible says. To do what the Bible says means to achieve the aims of the God of the Bible. We are supposed to care about the poor. But in order to know what to do to be obedient to that command, we have to go outside the Bible for the method – we have to study economics and understand how to achieve the good results.

I would recommend that we not be overly impressed by people who focus more on spirituality and Bible study and church over practical concerns like actually making sound financial decisions so that they can help others (charity) and not be a burden on others. The goal of a Christian is not to know the truth and feel good. The goal of the Christian is to know the truth and do good.

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373 children were victims of UK Muslim sex trafficking gang

The UK Labour Party

The UK Labour Party

This is reported by the ultra-leftist BBC, so they are very politically correct.

They write:

As many as 373 children may have been targeted for sex by gangs of men in Oxfordshire in the last 16 years, a serious case review found.

The investigation came after a sadistic sex gang of seven men were jailed in 2013 for abusing six girls in Oxford, between 2004 and 2012.

Thames Valley Police and Oxfordshire County Council made “many errors” in that case and could have acted sooner.

A victim of the gang said the issue had been “swept under the carpet”.

Of the 373 cases, the council said about 50 victims were boys.

[…]The report also called for research into why a significant proportion of people convicted in these kind of cases are of “Pakistani and/or Muslim heritage”.

In the Oxford case, known as Operation Bullfinch, two of the men were of east African origin and five of Pakistani origin.

Part of the problem with dealing with problems caused by unrestricted immigration from Muslim countries (e.g. – gang raping, sex-trafficking, terrorism) is that the leftist political parties don’t dare take action for fear of offending Muslims.

You’ll recall that our own State Department and President have both made statements to the effect that Islamic terrorists are only committing acts of terrorism because they are poor. Presumably, they also think that poor Christians and Jews would do the same if they were poor. It has nothing at all to do with an anti-West culture that is rooted in radical Islam. The solution – according to the secular left – is to give them jobs.

Let’s take a look at the story of Jihad John to see how well that worked:

Jihadi John family’s 20 years on benefits: How it’s cost taxpayers up to £400k to house fanatic and his relatives in upmarket areas

  • Mohammed Emwazi’s family granted asylum in 1996 after leaving Kuwait
  • They have since lived in five homes, one of which was worth £450 per week
  • Neither his father Jasem, 51, nor mother Ghaneya worked while in Britain
  • Westminster City Council is still paying rent on family’s £600,000 flat
  • One landlord described the family as ‘parasites’ and ‘tenants from hell’
  • MPs blasted family for ‘abusing hospitality’ and say payouts are ‘disgrace’

Jihadi John and his asylum-seeking family have milked the British benefits system for 20 years, the Mail can reveal today.

Housing the Islamic State executioner and his relatives in affluent parts of London has cost taxpayers up to £400,000.

One landlord said Mohammed Emwazi’s family were ‘parasites’ and ‘tenants from hell’. Incredibly, they are still believed to be pocketing £40,000 a year in handouts despite there being no sign of them in Britain.

Emwazi’s father Jasem, who has six children, is back in his native Kuwait – the country he claimed he fled fearing for his life.

Westminster City Council is still paying the rent on the family’s £600,000 flat even though the rules say housing benefit should normally be stopped after 13 weeks.

[…]The Mail investigation can also reveal that:

  • The family fled Kuwait after the first Gulf War, claiming persecution because they were seen to favour the Iraqi invasion in 1990;
  • They claimed asylum in the UK and won refugee status in 1996;
  • Five years later they were made British citizens and then started travelling back to Kuwait;
  • The family have claimed hundreds of thousands of pounds in benefits in Britain since their arrival in the country and lived in homes costing £450 a week;
  • Emwazi’s father is now back working in Kuwait while the family continues to receive state assistance for the home in Queen’s Park.

The owner of a house in Little Venice where they lived for four years said Westminster City Council paid £450 a week in rent for the family – £23,400 a year.

Two more of the five owners of homes they have lived in have confirmed their rent was paid by the council or through a housing association.

Assuming the same £23,400-a-year cost, then the bill over 20 years is £468,000.

I think what the secular left really means by “give them jobs” is “give them money for doing nothing”, i.e. – welfare. Political correctness is an ideology for wealthy elites, but it’s not so good for the poor people who actually have to deal with the consequences of the bad policies.

Now if you ask the Labour Party, who created these generous immigration policies and welfare programs, about their policies, they will tell you that this is all working as designed. It’s a feature, not a bug. They feel very good about themselves, calling good evil, and evil good. They are very generous handing out money they didn’t work for to people who then use it to kill the people who worked for the money. This is morally good, according to the secular left.

If we are really going to get serious about the problem, maybe we need leaders who aren’t so politically correct.

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