Oxfam fighting "extreme" wealth, not poverty

Oxfam Cares More About Ideology than Poverty - Foundation for Economic Education - Working for a free and prosperous world - Martin van Staden:

January 27, 2018 - "Oxfam recently published its latest report on global inequality, pretentiously titled Reward Work, Not Wealth. In the report, Oxfam not only regurgitates all the same economic fallacies we’re used to — chief among them, the labor theory of value and the notion that wealth inequality is a problem to be solved — but it goes on to make dangerous and authoritarian recommendations to governments on how they should respond to this supposed 'inequality crisis'....

"Oxfam is among that cabal of non-government organizations that love the much-touted slogan that the world’s wealth is increasingly being concentrated in the hands of fewer and fewer people..... In this year’s report, however, Oxfam cites research that 2017 saw the biggest increase in the number of billionaires in human history; 'one more every two days,' the charity claims. But ... Oxfam ... considers this phenomenon as indicative of 'extreme wealth' ... a problem that must be ended.

"Either wealth is increasingly being concentrated in the hands of fewer and fewer people ... or, as Oxfam reported this year, there has been a substantial, indeed unprecedented, increase in the number of billionaires. Oxfam should decide what its angle is going to be....

"The report makes another incredible claim: globally, billionaires’ wealth increased by $762 billion in 12 months. According to Oxfam, this 'huge increase could have ended global extreme poverty seven times over.' There is, of course, a massive problem with this claim. In 2011 alone, the United States government spent more than $668 billion on 126 welfare programs.... According to Michael Tanner at the Cato Institute, the United States has spent nearly $15 trillion on welfare since the War on Poverty was declared by Lyndon B. Johnson in 1964....

"Poverty is ended through employment, savings, and, crucially, a political environment conducive to economic freedom and economic growth; not by throwing money at the problem. Thankfully, on the up-side totally ignored by Oxfam, global extreme poverty has fallen dramatically over recent decades. It is likely that extreme poverty will be eliminated within the current generation. This won’t satiate Oxfam, however, because it concerns itself with the rich, not the destitute....

"Among a laundry list of state-centric suggestions, Oxfam calls on governments to 'use regulation and taxation to radically reduce levels of extreme wealth, as well as limit the influence of wealthy individuals and groups over policymaking.” It is safe to assume that Oxfam excludes itself — an extremely wealthy lobbying organization, having received over $244 million from governments alone between 2015-16 — from those groups that need limiting. It further advocates that governments should set targets 'for the collective income of the top 10% to be no more than the income of the bottom 40%'....

"It is high time that Oxfam be reduced to irrelevancy, at least as far as public policy goes. Its dodgy methodology, nit-picking of facts, and ideological commitment to the non-problem of inequality – at the expense of the very real problem of destitution – make it an intellectually dishonest player in policy advocacy. To the extent that Oxfam still engages in charity work, we must wish it all the best of luck. But solving poverty will not come out of its recommendations; instead, it will only yield more despair and tyranny.""

Read more: https://fee.org/articles/oxfam-cares-more-about-ideology-than-poverty/
'via Blog this'

How the Fed Is increasing economic inequality

Rand Paul Is Right: The Fed Is Increasing Inequality With Its Low Rates - Forbes - Jeffrey Dorfman: 

October 29, 2015 - "Last night’s Republican debate was supposed to be about economic policy, but instead it was, once again, more about moderators asking gotcha questions.... There was, however, a great moment of economic clarity, thanks to Rand Paul, on the surprisingly overlooked role the Fed has played in increasing economic inequality.

"Virtually all economists agree that the Fed’s low interest rates have been responsible for inflating stock market values. By reducing the returns to savings accounts, certificates of deposit and bonds, the Fed has intentionally driven ordinary investors to increase their investment allocation to the stock market, thereby boosting stock returns. Because people with more wealth tend to own more stock, those higher stock prices have led the rich to gain much more than the poor and middle class.

"Low interest rates have meant low borrowing costs for large corporations with direct access to capital markets. This low-cost borrowing has boosted corporate profits which also flow mostly to the wealthy.

"Poorer individuals, with smaller savings and few other assets, tend to be heavier users of credit cards for borrowing.... Unfortunately, while the Fed has pushed down interest rates for big corporations, average credit card interest rates have only dropped about 1.5 percentage points (from about 14.5 to 13%).... Wealthier individuals, with more savings and other assets, rarely need to carry a credit card balance, but they do borrow (tax-deductible) funds in the form of mortgage debt, often in large amounts. Thanks partly to the Fed’s many moves to lower interest rates, mortgage rates have fallen about 2.5 percentage points (roughly from 6.5 to 4% for 30 year fixed rate mortgages).... For example, somebody with a $400,000 mortgage could save ... $600 to $800 per month, way more than the $20 per month the poor are saving on credit card debt.

"Finally, the low interest rates set by the Fed combined with the additional labor costs thanks to the Obama Administration (Obamacare and its associated taxes) are changing the relative prices of labor and capital.... This also increases economic inequality because the poor and middle class earn most (or all) of their money from labor income, while the rich collect a significant share of their income in various forms of returns to capital.... Purposely tilting the economy in favor of capital and against labor is pretty close to taking from the poor and giving to the rich, the exact reverse of normal government attempts to redistribute income.

"[While] the left is consumed with economic inequality, nary a voice on the left is complaining about the Fed’s role in making it worse. Rand Paul is correct that the Fed is causing a widening of economic inequality....If you want less economic inequality, we should begin by stopping policies that make it worse."

Read more: http://www.forbes.com/sites/jeffreydorfman/2015/10/29/rand-paul-is-right-the-fed-is-increasing-inequality/
'via Blog this'

More problems with Thomas Piketty's thesis

The FT Claims Thomas Piketty's Numbers Don't Add Up, Piketty Calls The FT Ridiculous - Forbes - Tim Worstall:

May 25, 2014 - "This has rather put the cat amongst the pigeons: the Financial Times went through the data that Thomas Piketty used to prove that wealth is becoming ever more concentrated and found, at least so they claim, that the evidence isn’t actually there. There are some minor transcription errors, there’s also some questionable interpolations in the data sets. But the real killer is that the claimed concentration of wealth, the thing that Piketty insists is going to get ever worse, doesn’t actually seem to exist....

"Here’s the nub of the FT’s claim: '... once the FT cleaned up and simplified the data, the European numbers do not show any tendency towards rising wealth inequality after 1970. An independent specialist in measuring inequality shared the FT’s concerns'....

"This isn’t the only problem with the case that Piketty is making either. As I noted ... he is correct in stating that the wealth to GDP ratio is rising.... However, as the FT says we don’t seem to see any increase in the concentration of wealth over recent decades. But if wealth to GDP is rising, and wealth isn’t becoming ever more concentrated, well, where is that increased wealth?

"The answer, amusingly, coming from Emmanuel Saez, a regular Piketty collaborator ... the increased wealth is our pensions savings. And this is another terrible hole in Piketty’s argument. For it’s something that we would have expected to see from the first. The lifetime savings hypothesis almost insists that alongside rising lifespans (one of the two great demographic changes of the past 70 or so years, along with the declining fertility rate) that we would see an increase in pensions savings. And that’s exactly what Saez does find: pensions savings move from some trivial percentage of GDP to 150% of it....

"Piketty seems to have assumed that the rise in wealth was all going to the rich: whereas it really seems to have been going to pay for our own old ages."

Read more: http://www.forbes.com/sites/timworstall/2014/05/25/the-ft-claims-thomas-pikettys-numbers-dont-add-up-piketty-calls-the-ft-ridiculous/
'via Blog this'

Six flaws in Piketty's Capital in the 21st Century

Six Ways Thomas Piketty's 'Capital' Isn't Holding Up to Scrutiny - Kyle Smith, Forbes:

May 1, 2014 - "Dubbed the 'rock-star economist,' France's Thomas Piketty has topped the Amazon.com  bestseller list with the surprise blockbuster book Capital in the Twenty-First Century, which argues that because the return on capital must be greater than overall growth, the rich are destined to hog an ever-increasing proportion of the economic pie.

"Piketty's research, his eloquence (he quotes Jane Austen and Honore de Balzac) and his call for wealth taxes plus a confiscatory marginal income tax rate (80 percent) have Keynesian liberal economists swooning. Their leader, Paul Krugman, boasts that 'the right seems unable to mount any kind of substantive counterattack to Mr. Piketty’s thesis. Instead, the response has been all about name-calling.'

"Krugman is misinformed. Piketty's book is being shredded. Here’s a brief rundown of some of the flaws in Capital in the Twenty-First Century” that have already been exposed."

Read more: http://www.forbes.com/sites/kylesmith/2014/05/01/six-ways-thomas-pikettys-capital-isnt-holding-up-to-scrutiny/
'via Blog this'

Paranoid libertarians vs. angry liberals

The paranoid libertarian and his enemy, the angry liberal - Eric Posner, University of Chigago Law School:

"In a recent essay, Harvard Law School professor Cass Sunstein identified an impulse he called 'paranoid libertarianism.' A paranoid libertarian is someone who distrusts the government to an unreasonable extent. Sunstein believes that many people who oppose gun control, health care reform, and progressive taxation fit the description. For example, a paranoid libertarian might not object to modest gun licensing requirements or background checks in principle but opposes these policies because he believes that the government will deny licenses to people who deserve them, or that a licensing rule will accustom people to gun control, paving the way to confiscation of all handguns.... Sunstein argues that these beliefs are unreasonable...."

"In fact, the fear of government is far more serious than the fear of flying or the fear of nuclear power. If people trust the government, they may accept its assurances that flying or nuclear power is safe. They may absorb the messages of its educational programs. If they don’t trust the government, then no go. 'Don’t worry, you can trust us' is, after all, exactly what an evil government would say....

"The angry liberal has distinctive characteristics just like the paranoid libertarian. He is distressed by significant social ills and seeks someone to blame for them. The social ills — inequality, inadequate health care, bad schools — are large ones. But it makes little sense to get angry at rich people for causing them.... The huge level of inequality that currently exists is mostly the result of social trends, not the bad acts of identifiable rich people.... As a political emotion, anger is just as irrational as fear is....

"In our current political climate, paranoid libertarians oppose government action that they often wrongly believe will harm them, angering the liberals who believe that government action is needed to solve society’s problems. The liberals’ anger further fuels the libertarians’ paranoia, which hardens their obstructionism, which in turn sends liberals into flights of rage."

Read more: http://www.slate.com/articles/news_and_politics/view_from_chicago/2014/02/the_paranoid_libertarian_and_his_enemy_the_angry_liberal.html
'via Blog this'

Slate claims LP failed to take stand on gay rights

Slate Wonders Why Libertarian Party Insists on Being Libertarian on Gay Rights Issues, Reveals Utter Ignorance of Party's History - Hit & Run : Reason.com - Brian Doherty:

December 30, 2012 - "Weird little piece up at Slate today, about an issue certainly none of their readers or pretty much anyone else cares about, but feeds a generic endless desire to scratch at the persistently annoying itch of libertarianism in these here times.

"It is called 'How Libertarians Failed Gay Rights' and its URL contains the phrase 'the party failed to take a stand' on gay rights. Its evidence for this is that on the LP's current website, author Tyler Lopez couldn't find a dedicated page about gay rights.

"The Party's platform does, though Lopez doesn't mention this, contain this:

Sexual orientation, preference, gender, or gender identity should have no impact on the government's treatment of individuals, such as in current marriage, child custody, adoption, immigration or military service laws. Government does not have the authority to define, license or restrict personal relationships. Consenting adults should be free to choose their own sexual practices and personal relationships....

"Slate's piece combines confused thinking with near utter ignorance on its topic. However, it will, if read quickly and carelessly by equally ignorant readers, help make certain people think less of libertarianism, and that's all that matters."

Read more: http://reason.com/blog/2013/12/30/slate-wonders-why-libertarian-party-insi
'via Blog this'

Dear Pope: It's a better world than you think

Is the Pope Right About the World? - Marian Tupy - The Atlantic:

December 11, 2013 - "In Evangelii Gaudium, an 'apostolic exhortation' released late last month, the pope bemoans inequality, poverty, and violence in the world.

"But here’s the problem: The dystopian world that Francis describes, without citing a single statistic, is at odds with reality. In appealing to our fears and pessimism, the pope fails to acknowledge the scope and rapidity of human accomplishment — whether measured through declining global inequality and violence, or growing prosperity and life expectancy....

"First, consider inequality. Academic researchers ... all agree that global inequality is declining. That is because 2.6 billion people in China and India are richer than they used to be. Their economies are growing much faster than those of their Western counterparts, thus shrinking the income gap that opened at the dawn of industrialization in the 19th century, when the West took off and left much of the rest of the world behind.

"Paradoxically, the shrinking of the global inequality gap was only possible after India and China abandoned their attempts to create equality through central planning....

"Second, let’s look at poverty.... Brookings Institution researchers Laurence Chandy and Geoffrey Gertz ... 'estimate that between 2005 and 2010, the total number of poor people around the world fell by nearly half a billion, from over 1.3 billion in 2005 to under 900 million in 2010. Poverty reduction of this magnitude is unparalleled in history: never before have so many people been lifted out of poverty over such a brief period of time.'"

Read more: http://www.theatlantic.com/international/archive/2013/12/is-the-pope-right-about-the-world/282276/
'via Blog this'

Does inequality matter?

When is inequality harmful? When it's caused by cronyism | WashingtonExaminer.com - Timothy P. Carney:

December 6, 2013: "President Obama wants to put inequality at the center of America's political discourse. Fine. Here’s the opening question: 'Does inequality matter?'

The answer: 'It depends.' It depends on how governments react to inequality, it depends on how developed the country is, it depends on whether it's wealth inequality or income inequality.

"It also depends on how the wealthy got wealthy, according to a recent academic study. In short: Inequality doesn’t hurt a country, unless the inequality results from government favors.

"Inequality can be messy to talk about, because it is entangled in many different concepts that need to be considered separately."

Read more: http://washingtonexaminer.com/when-is-inequality-harmful-when-its-caused-by-cronyism/article/2540338
'via Blog this'