Izzy knows about as much economics as you know of history and politics.
You two are free to take that any way you wish.
Essential Economics for Politicians
- Thread starter Bruddah IZ
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Izzy knows about as much economics as you know of history and politics.
You two are free to take that any way you wish.
Bruddah IZ
DA
Thank you. Youʻll get there one day.
Arranging & posting the information was appreciated
The fact that it will freak pinheads on the left out was brilliant...
Bruddah IZ
DA
While you people have been immersed in the Russian Circus your Federal Reserve has been setting up the next financial crisis.
Today’s First-Time Homebuyers Are Alive, but Highly Leveraged
A glance at the data tells all: The National Mortgage Risk Index (NMRI), which monitors over 90 percent of mortgages to first-time buyers, shows big increases. In February 2017, the number of first-time buyers was up 7 percent over last year — marking the 30th consecutive month of growth — and up 35 percent from three years ago. But that’s not all. For the last 28 out of 36 months, first-time buyers were also buying more homes than repeat buyers. In February of this year, 60 percent of all mortgages underwritten by the government went to first-time buyers.
This has happened only because standards have been lowered: buyers are putting less skin in the game and are assuming higher debt burdens. First-time buyers no longer need 20 percent of a home’s price for a down payment. NMRI data show that only one in five borrowers are meeting or exceeding this threshold. The Department of Veterans Affairs (VA) and Rural Housing Services (RHS) programs are issuing loans without any down payments, and the Federal Housing Administration (FHA) guarantees loans with only 3.5 percent down. Fannie Mae and Freddie Mac, the government-sponsored mortgage enterprises, are buying mortgages with as little as 3 percent down. Today, the median first-time buyer puts down 3.5 percent or $8,300 instead of the previous 20 percent standard down payment.
There is more. For those who haven’t managed to save these lower amounts, many State Housing Finance Agencies, nonprofits, or even city governments, are offering down payment and closing cost assistance. At least 15 percent of first-time buyers are taking advantage of these programs. Taken together, over 20 percent of first-time buyers bring nothing to the table.
The catch, of course, is that ever increasing demand and a severely limited supply of homes — even more so at the lower end of the market — are causing house prices to rise at 5-6 percent per year, much faster than incomes. Today, inflation-adjusted home prices have already risen 28 percent since their early 2012 trough, and are only about 15 percent away from their 2006 pre-crisis peak.
Today’s First-Time Homebuyers Are Alive, but Highly Leveraged
A glance at the data tells all: The National Mortgage Risk Index (NMRI), which monitors over 90 percent of mortgages to first-time buyers, shows big increases. In February 2017, the number of first-time buyers was up 7 percent over last year — marking the 30th consecutive month of growth — and up 35 percent from three years ago. But that’s not all. For the last 28 out of 36 months, first-time buyers were also buying more homes than repeat buyers. In February of this year, 60 percent of all mortgages underwritten by the government went to first-time buyers.
This has happened only because standards have been lowered: buyers are putting less skin in the game and are assuming higher debt burdens. First-time buyers no longer need 20 percent of a home’s price for a down payment. NMRI data show that only one in five borrowers are meeting or exceeding this threshold. The Department of Veterans Affairs (VA) and Rural Housing Services (RHS) programs are issuing loans without any down payments, and the Federal Housing Administration (FHA) guarantees loans with only 3.5 percent down. Fannie Mae and Freddie Mac, the government-sponsored mortgage enterprises, are buying mortgages with as little as 3 percent down. Today, the median first-time buyer puts down 3.5 percent or $8,300 instead of the previous 20 percent standard down payment.
There is more. For those who haven’t managed to save these lower amounts, many State Housing Finance Agencies, nonprofits, or even city governments, are offering down payment and closing cost assistance. At least 15 percent of first-time buyers are taking advantage of these programs. Taken together, over 20 percent of first-time buyers bring nothing to the table.
The catch, of course, is that ever increasing demand and a severely limited supply of homes — even more so at the lower end of the market — are causing house prices to rise at 5-6 percent per year, much faster than incomes. Today, inflation-adjusted home prices have already risen 28 percent since their early 2012 trough, and are only about 15 percent away from their 2006 pre-crisis peak.
Sheriff Joe
DA
Something about history and doomed.
Bruddah IZ
DA
Meet Johannesburg's New Libertarian Mayor
reason: Under apartheid, the white government claimed to be capitalist. So many black South Africans support parties that are critical of free markets, such as the ANC, or explicitly anti-capitalist, like EFF. What explains your pro-market stance?
Mashaba: In 1950, they passed the Suppression of Communism Act. So when I was born in 1959, by virtue of that law and being black, I was automatically a communist. Look at that piece of legislation. It says that anyone that advocated the rights of blacks must be regarded as a communist.
What compounded the problem was that as we were growing up, the communists were the ones that seemed to be helping us, and on the other hand the Americans and the British were seen to be working with the apartheid government. So as far as blacks were concerned, Russia was the savior.
People had no idea what Russia was doing to its own people. If you saw the mess that was happening in Russia – our people had no idea. But the ANC guys who had been to Russia, they knew how brutal the system is.
In 1980, with my university closing down, I tried to leave the country to go for military training. I was hoping the Russians would give me an AK-47 and train me. I had nothing to lose; the apartheid government wanted to destroy my future and my life.--Leon Louw
reason: Under apartheid, the white government claimed to be capitalist. So many black South Africans support parties that are critical of free markets, such as the ANC, or explicitly anti-capitalist, like EFF. What explains your pro-market stance?
Mashaba: In 1950, they passed the Suppression of Communism Act. So when I was born in 1959, by virtue of that law and being black, I was automatically a communist. Look at that piece of legislation. It says that anyone that advocated the rights of blacks must be regarded as a communist.
What compounded the problem was that as we were growing up, the communists were the ones that seemed to be helping us, and on the other hand the Americans and the British were seen to be working with the apartheid government. So as far as blacks were concerned, Russia was the savior.
People had no idea what Russia was doing to its own people. If you saw the mess that was happening in Russia – our people had no idea. But the ANC guys who had been to Russia, they knew how brutal the system is.
In 1980, with my university closing down, I tried to leave the country to go for military training. I was hoping the Russians would give me an AK-47 and train me. I had nothing to lose; the apartheid government wanted to destroy my future and my life.--Leon Louw
Bruddah IZ
DA
reason: How did you become a capitalist, then?
Mashaba: People must be careful by what they mean by capitalist. Capitalism for me is my right to feed myself and my family, to provide for myself and my family without any government intervention.
Government's role is to ensure that people don't kill me; when I have a dispute with you, to have courts I can take you to; and to provide infrastructure. That's the role of government. But I don't think I need any government to tell me that I must wake up to feed my family. If I decide that I don't want to work, why should government force me to work? As long as I'm not going to be a liability to that government. If you decide you don't want to work, then you cannot expect other people to assist you.
Obviously, some people for some reason need short-term intervention. I am for that. But if someone decides, "You know what, I don't want to work"? I don't think any government needs to force people to work. I don't need government to tell me I must work for you and then determine how much you must pay me and how many hours I must work.
When they start coming out with those policies, it is when you start stifling development. I've seen trade unions in this country becoming powerful and controlling our people. I am no longer allowed to reward people who are hard-working because unions assume everyone is the same. Unions discourage people from being the best they can be. I must pay people exactly the same regardless of whether they work hard.--Leon Louw
Mashaba: People must be careful by what they mean by capitalist. Capitalism for me is my right to feed myself and my family, to provide for myself and my family without any government intervention.
Government's role is to ensure that people don't kill me; when I have a dispute with you, to have courts I can take you to; and to provide infrastructure. That's the role of government. But I don't think I need any government to tell me that I must wake up to feed my family. If I decide that I don't want to work, why should government force me to work? As long as I'm not going to be a liability to that government. If you decide you don't want to work, then you cannot expect other people to assist you.
Obviously, some people for some reason need short-term intervention. I am for that. But if someone decides, "You know what, I don't want to work"? I don't think any government needs to force people to work. I don't need government to tell me I must work for you and then determine how much you must pay me and how many hours I must work.
When they start coming out with those policies, it is when you start stifling development. I've seen trade unions in this country becoming powerful and controlling our people. I am no longer allowed to reward people who are hard-working because unions assume everyone is the same. Unions discourage people from being the best they can be. I must pay people exactly the same regardless of whether they work hard.--Leon Louw
Bruddah IZ
DA
What causes high tuition? Don’t trust your intuition
A typical student in an American public college pays thousands of dollars more in tuition than just a decade ago. Students and parents are worried and frustrated, and many point the finger at state legislators, who have cut funds to state schools. During last year’s presidential campaign, Hillary Clinton blamed “state disinvestment” in higher education for soaring tuition and declared her support for “free college.”
While the “disinvestment” narrative is simple and appealing, it collapses under scrutiny. If state funding to public colleges falls by $100 per student, it seems logical to conclude that tuition must go up by $100 to compensate. But that isn’t what happens. When the Great Recession began in 2008, funding at public colleges fell, as declining tax revenue forced states to make budget cuts. Tuition went up. In the mid-2000s, when the economy was strong, state funding to public colleges rose. Tuition went up then, too.
Tuition goes up no matter what state legislators do. Public colleges, with state boundaries insulating them from competition, and generous federal student aid programs at their disposal, charge as much as they can get away with. Changes in state funding are largely irrelevant.
This article appeared in The Wall Street Journal on June 8, 2017. If you are not a WSJ subscriber, you may access the full piece via WSJ’s Twitter profile here.
A typical student in an American public college pays thousands of dollars more in tuition than just a decade ago. Students and parents are worried and frustrated, and many point the finger at state legislators, who have cut funds to state schools. During last year’s presidential campaign, Hillary Clinton blamed “state disinvestment” in higher education for soaring tuition and declared her support for “free college.”
While the “disinvestment” narrative is simple and appealing, it collapses under scrutiny. If state funding to public colleges falls by $100 per student, it seems logical to conclude that tuition must go up by $100 to compensate. But that isn’t what happens. When the Great Recession began in 2008, funding at public colleges fell, as declining tax revenue forced states to make budget cuts. Tuition went up. In the mid-2000s, when the economy was strong, state funding to public colleges rose. Tuition went up then, too.
Tuition goes up no matter what state legislators do. Public colleges, with state boundaries insulating them from competition, and generous federal student aid programs at their disposal, charge as much as they can get away with. Changes in state funding are largely irrelevant.
This article appeared in The Wall Street Journal on June 8, 2017. If you are not a WSJ subscriber, you may access the full piece via WSJ’s Twitter profile here.
Sheriff Joe
DA
The Power to (Over)Tax – Is the Power to Destroy
The late Supreme Court Chief Justice (amongst many other impressive gigs) John Marshall rightly noted “The power to tax – is the power to destroy.” The power to OverTax, of course – will destroy even more.
We have in our nation established a very anti-human nature approach to government. We punish things of which we claim to want more – and reward things of which we claim to want less.
We tax income generated by work – and give money to people who don’t work. Human nature empirically tells us that we will get less of the former – and more of the latter. Why do something to get something – when you get something for doing nothing?
Human nature works on a sliding scale. The more you tax work and reward non-work, the higher up the human nature industriousness ladder you go – to pull people climbing upward off and into the Do Nothing pit.
And of course, the harder and more complex the work is – and the higher the investment costs required to do it – the more likely being taxed more will drive people out of that work.
Trending
Are Some Republicans Dumb Enough to Go After Robert Mueller?
Jay Caruso
To wit: The Alaskan energy sector. Extracting energy under the best of circumstances ain’t cheap. Doing it in the climactically and topographically challenged Last Frontier – is even more expensive.
Thankfully, there is much oil and gas to be culled – and that sector is a significant portion of the state’s overall economy. Nearly one out of every three Alaskan gigs – is energy sector related. This, of course, generates a whole lot of government tax money.
The energy sector – is Alaska’s Golden Goose. Unfortunately, state House Democrats are looking to kill it.
Alaska is facing a fairly precipitous government budget shortfall – $2.5 billion. Which, ironically enough, is almost exactly how much the government increased spending…IN JUST ONE YEAR: “Between fiscal years 2014 and 2015, total government spending in Alaska increased by approximately $2.4 billion – from $11.4 billion in fiscal year 2014 to an estimated $13.8 billion in 2015. This represents a 17.22-percent increase.”
Here’s a thought: Go back to pre-MASSIVE spending increase spending levels. Problem solved.
But as with most people in government everywhere, Alaska Democrats don’t even think to perhaps, maybe…cut spending a smidge or two. Of course not.
Nigh the entirety of the government budget shortfall discussion – has been about from which Alaskans the government should take more money.
One-trick-pony state House Democrats – are again looking to wring the Golden Goose’s neck. They want to hike taxes on the energy sector. For the same reason Willie Sutton robbed banks – because that’s where the money is.
Except that – the money isn’t there so much anymore. Besides the already high taxes and expenses the energy sector faces – it has been rocked by the protracted fall of global energy prices. The industry’s threads – have been getting increasingly bare. And here come Alaskan Democrats – looking to cut even more cloth.
This time, the state’s Democrats’ desire to OverTax – could very well destroy the Alaskan energy sector. Needlessly. Pointlessly.
All to avoid even the merest thought of rolling back any of the government’s recent gigantic spending increase.
Alaska’s Donkeys should be told what government big spenders everywhere need to hear:
It ain’t a revenue problem – it’s a spending problem.
The late Supreme Court Chief Justice (amongst many other impressive gigs) John Marshall rightly noted “The power to tax – is the power to destroy.” The power to OverTax, of course – will destroy even more.
We have in our nation established a very anti-human nature approach to government. We punish things of which we claim to want more – and reward things of which we claim to want less.
We tax income generated by work – and give money to people who don’t work. Human nature empirically tells us that we will get less of the former – and more of the latter. Why do something to get something – when you get something for doing nothing?
Human nature works on a sliding scale. The more you tax work and reward non-work, the higher up the human nature industriousness ladder you go – to pull people climbing upward off and into the Do Nothing pit.
And of course, the harder and more complex the work is – and the higher the investment costs required to do it – the more likely being taxed more will drive people out of that work.
Trending
Are Some Republicans Dumb Enough to Go After Robert Mueller?
Jay Caruso
To wit: The Alaskan energy sector. Extracting energy under the best of circumstances ain’t cheap. Doing it in the climactically and topographically challenged Last Frontier – is even more expensive.
Thankfully, there is much oil and gas to be culled – and that sector is a significant portion of the state’s overall economy. Nearly one out of every three Alaskan gigs – is energy sector related. This, of course, generates a whole lot of government tax money.
The energy sector – is Alaska’s Golden Goose. Unfortunately, state House Democrats are looking to kill it.
Alaska is facing a fairly precipitous government budget shortfall – $2.5 billion. Which, ironically enough, is almost exactly how much the government increased spending…IN JUST ONE YEAR: “Between fiscal years 2014 and 2015, total government spending in Alaska increased by approximately $2.4 billion – from $11.4 billion in fiscal year 2014 to an estimated $13.8 billion in 2015. This represents a 17.22-percent increase.”
Here’s a thought: Go back to pre-MASSIVE spending increase spending levels. Problem solved.
But as with most people in government everywhere, Alaska Democrats don’t even think to perhaps, maybe…cut spending a smidge or two. Of course not.
Nigh the entirety of the government budget shortfall discussion – has been about from which Alaskans the government should take more money.
One-trick-pony state House Democrats – are again looking to wring the Golden Goose’s neck. They want to hike taxes on the energy sector. For the same reason Willie Sutton robbed banks – because that’s where the money is.
Except that – the money isn’t there so much anymore. Besides the already high taxes and expenses the energy sector faces – it has been rocked by the protracted fall of global energy prices. The industry’s threads – have been getting increasingly bare. And here come Alaskan Democrats – looking to cut even more cloth.
This time, the state’s Democrats’ desire to OverTax – could very well destroy the Alaskan energy sector. Needlessly. Pointlessly.
All to avoid even the merest thought of rolling back any of the government’s recent gigantic spending increase.
Alaska’s Donkeys should be told what government big spenders everywhere need to hear:
It ain’t a revenue problem – it’s a spending problem.
Sheriff Joe
DA
Tax cuts aren’t only reason why Kansas has budget issues
Taylor MillardPosted at 10:41 am on June 14, 2017
There’s been a lot of hay made over the fact Kansas Republicans rejected a plan by Governor Sam Brownback to keep taxes low because of a major budget deficit. The Legislature approved the budget over the weekend, basically undoing five years worth of tax cuts. Via KCUR:
A group of moderate Republicans and Democrats elected since the passage of the tax cuts in 2012 helped lead the charge, but even some lawmakers who initially supported the cuts joined the override effort.
Senate Majority Leader Jim Denning voted in 2012 for the cuts, hoping they would provide the Kansas economy with the shot of adrenaline that Brownback promised. But weary of perennial budget struggles, Denning said before the override vote that the time had come to admit the cuts hadn’t worked as advertised.
“I’ve always backed up and mopped up my mess. That’s what I’m doing now,” said Denning, an Overland Park Republican.
Moderate-leaning Republican Stephanie Clayton, also from Overland Park, said reversing the tax cuts was a “major step” toward fixing the state’s budget problems.
“We have turned things around and we are headed in the right direction,” Clayton said.
The $1.2 billion tax increase passed over Brownback’s objections raises individual income tax rates and restores a third tax bracket eliminated by the 2012 bill. It also repeals a controversial tax exemption given to more than 300,000 business owners and farmers.
The Kansas Legislature decided to override Brownback’s initial veto of the tax increase last week, prompting a friend of mine to proclaim on Facebook it was again proof “trickle down” economics doesn’t work. That appears to be the prevailing theory nationwide, as well, with CNN reporting it was the failure of a “grand conservative experiment.” Here’s what Kansas City Star’s Bryan Lowry told CNN after being asked what happened.
These tax cuts, which Brownback had promised would lead to astronomical job growth, had really become politically toxic over the last four years. The state was running into a budget crisis every six months pretty much from November 2014 onward. For the current year, Kansas faced a roughly $900 million budget shortfall (over the next two years) and an order from the Kansas Supreme Court to increase education funding, so raising taxes was pretty much unavoidable unless you really wanted to make deep cuts to everything but K-12 education. And after three sessions of looking for one-time fixes, I think a lot of members of the Legislature were just ready to end the perpetual budget crisis.
Lowry actually got to the truth of the matter in a later comment, by pointing out tax cut supporters were criticizing the fact Kansas refused to cut spending over the last five years. It’s something Americans for Prosperity Kansas director Jeff Glendening hammered home in February. Via KC Star:
Brownback’s tax cuts were supposed to be the start of a new, small-government approach to growing the economy. And yet lawmakers did little to slow the growth in state spending: The state’s all-funds budget has increased by well over $1 billion since 2013.
There was no shortage of reforms available to reduce spending. A 2016 efficiency report commissioned by the Legislature identified 105 opportunities to increase the efficiency of the state government, which would cumulatively provide over $2 billion in savings over a five-year period.
Ultimately, lawmakers failed to follow through on their promise of a smaller government by refusing to cut spending along with taxes. That is why critics of the income tax cuts are wrong to seize on our imbalanced budget as proof they didn’t work. The point of these tax cuts, which saved individuals and small businesses about $800 million per year, was not to fill the state’s coffers. The point was to put money back into people’s pockets.
The hard data proves it as well. Kansas has seen only one year where government spending dropped (FY 2014), while increasing spending every year since then. This is something Republicans and so-called small government conservatives fail to realize time and time again. It’s not just tax cuts which spur growth, but slashing expenses. Most people cut spending when their income drops below a certain level. Governments need to learn this as well, and it seems like the only U.S. president with a lick of sense was Calvin Coolidge, who met every day with his Treasury Secretary to cut the budget.
The GOP refuses to learn this lesson, despite swearing to be the party of low spending and small government. It’s not just a GOPe problem, but a problem for pretty much the entire party. Perhaps it’s the idea of “doing something,” to appeal to constituents or the ridiculous idea that only cutting taxes will spur growth. They’ll learn it at some point, right?
Taylor MillardPosted at 10:41 am on June 14, 2017
There’s been a lot of hay made over the fact Kansas Republicans rejected a plan by Governor Sam Brownback to keep taxes low because of a major budget deficit. The Legislature approved the budget over the weekend, basically undoing five years worth of tax cuts. Via KCUR:
A group of moderate Republicans and Democrats elected since the passage of the tax cuts in 2012 helped lead the charge, but even some lawmakers who initially supported the cuts joined the override effort.
Senate Majority Leader Jim Denning voted in 2012 for the cuts, hoping they would provide the Kansas economy with the shot of adrenaline that Brownback promised. But weary of perennial budget struggles, Denning said before the override vote that the time had come to admit the cuts hadn’t worked as advertised.
“I’ve always backed up and mopped up my mess. That’s what I’m doing now,” said Denning, an Overland Park Republican.
Moderate-leaning Republican Stephanie Clayton, also from Overland Park, said reversing the tax cuts was a “major step” toward fixing the state’s budget problems.
“We have turned things around and we are headed in the right direction,” Clayton said.
The $1.2 billion tax increase passed over Brownback’s objections raises individual income tax rates and restores a third tax bracket eliminated by the 2012 bill. It also repeals a controversial tax exemption given to more than 300,000 business owners and farmers.
The Kansas Legislature decided to override Brownback’s initial veto of the tax increase last week, prompting a friend of mine to proclaim on Facebook it was again proof “trickle down” economics doesn’t work. That appears to be the prevailing theory nationwide, as well, with CNN reporting it was the failure of a “grand conservative experiment.” Here’s what Kansas City Star’s Bryan Lowry told CNN after being asked what happened.
These tax cuts, which Brownback had promised would lead to astronomical job growth, had really become politically toxic over the last four years. The state was running into a budget crisis every six months pretty much from November 2014 onward. For the current year, Kansas faced a roughly $900 million budget shortfall (over the next two years) and an order from the Kansas Supreme Court to increase education funding, so raising taxes was pretty much unavoidable unless you really wanted to make deep cuts to everything but K-12 education. And after three sessions of looking for one-time fixes, I think a lot of members of the Legislature were just ready to end the perpetual budget crisis.
Lowry actually got to the truth of the matter in a later comment, by pointing out tax cut supporters were criticizing the fact Kansas refused to cut spending over the last five years. It’s something Americans for Prosperity Kansas director Jeff Glendening hammered home in February. Via KC Star:
Brownback’s tax cuts were supposed to be the start of a new, small-government approach to growing the economy. And yet lawmakers did little to slow the growth in state spending: The state’s all-funds budget has increased by well over $1 billion since 2013.
There was no shortage of reforms available to reduce spending. A 2016 efficiency report commissioned by the Legislature identified 105 opportunities to increase the efficiency of the state government, which would cumulatively provide over $2 billion in savings over a five-year period.
Ultimately, lawmakers failed to follow through on their promise of a smaller government by refusing to cut spending along with taxes. That is why critics of the income tax cuts are wrong to seize on our imbalanced budget as proof they didn’t work. The point of these tax cuts, which saved individuals and small businesses about $800 million per year, was not to fill the state’s coffers. The point was to put money back into people’s pockets.
The hard data proves it as well. Kansas has seen only one year where government spending dropped (FY 2014), while increasing spending every year since then. This is something Republicans and so-called small government conservatives fail to realize time and time again. It’s not just tax cuts which spur growth, but slashing expenses. Most people cut spending when their income drops below a certain level. Governments need to learn this as well, and it seems like the only U.S. president with a lick of sense was Calvin Coolidge, who met every day with his Treasury Secretary to cut the budget.
The GOP refuses to learn this lesson, despite swearing to be the party of low spending and small government. It’s not just a GOPe problem, but a problem for pretty much the entire party. Perhaps it’s the idea of “doing something,” to appeal to constituents or the ridiculous idea that only cutting taxes will spur growth. They’ll learn it at some point, right?
Bruddah IZ
DA
Venezuela, Greece.
Bruddah IZ
DA
Bruddah IZ
DA
It's always about politicians telling citizens that they can spend your money better than you can. Therefore, let government raise taxes.
Sure, its simple to us people.
What did FDR say about gov. unions?
Sheriff Joe
DA
Sounds like the same attitude of some of these assholes around here. AKA the smart guys.
I honestly think a comedy class or two with tenacious cant hurt.
You remind me of the guy with the sign who shoots up baseball fields.
It's posts like this that still make me think you're the most under appreciated poster in here. You really do wield that sarcasm like it's Hattori Hanzo steel. And even though I know none of these jokers would man up and admit it, you can tell by the pure venom of their responses that sarcasm cuts deep...