Romney’s Taxes – Gentlemen’s Games and Morbid Curiosity

August 17, 2012
Posted by Jay Livingston

Mitt Romney still refuses to make his tax returns public.  Instead, he now says that for the last ten years he’s never paid less than 13%.  The response from the Obama campaign: Prove it.

The Romneyites are in high dudgeon about this request.  To ask to see the actual returns rather than accept Mitt’s word, why, it’s so uncouth, so ill-mannered. Such curiosity is ungentlemanly; it borders on the morbid.

W.C. Fields fans will no doubt remember the scene in “My Little Chickadee,” set in the old West, where Fields (Cuthbert J. Twillie) approaches a stranger in a saloon. He offers to play a game: cut the cards, high card wins. They agree to play for $100. The stranger accepts and cuts a king.

FIELDS  

Don't show me the cards. A gentleman's game. 

I don't want to look at it.

Fields then cuts.  The camera can see that the card is a two, but the stranger cannot.

“Ace,” Fields announces and puts the cards back on the deck.

STRANGER

I didn't see it.

FIELDS

[He turns the deck face up and thumbs through it 

till he finds an ace, which he holds up for the stranger to see.]

Very well, here you are, Nosy Parker. Ace. 

I hope that satisfies your morbid curiosity.

(For full effect, this  should be seen, not transcribed, but alas, I cannot find an embeddable clip. You can watch the scene here. It’s less than 2 minutes.)

There are good reasons to have some morbid curiosity about those tax returns.  Thirteen percent sounds reasonable, though it’s far less than what you pay if you earn a salary of $75,000.  But thirteen percent of what? As Jonathan Zasloff says,

If Romney’s income (mostly from capital gains) was, say, $10 million a year, but $9 million of it is in a tax shelter in the Cayman Islands,  Romney could pay $130,000 on the $1 million and call it $13%.  But in fact, he would be paying on his real income only 1.3%. 

And that’s just a simple version.  Given the complexities of the tax code, Romney could have done much more creative accounting.  Another law professor, Victor Fliescher, has a slightly more complicated scenario (here).  Fleischer’s specialty is tax law, especially carried interest, so he knows that this is not a gentleman’s game.  To Romney’s 13% claim, he says in a most ungentlemanly fashion, “I call bullshit.”

Cream and Charters

August 16, 2012
Posted by Jay Livingston

A couple of weeks ago, NYC schools chancellor Joel Klein was waving around test scores for all to see as irrefutable evidence that charter schools do a better job than traditional public schools. I voiced some reservations (here).

Not all poor schoolchildren are alike, and there’s good reason to expect systematic differences between charter school kids and others. The charter school kids have parents who, while they may be poor, are more involved in their education.  The traditional public schools get the kids who are left behind. The cumulative effect of this selection makes for vastly different kinds of learning environments – differences that have much more to do with kinds of parents and children than with kinds of school organization or the presence or absence of unions.

The charter cheerers like Klein deny any such effect.  (Klein is not just a championr of charters, He puts the taxpayers’ money where his mouth is. He used his position as NYC schools chancellor to give every advantage to charters – especially all four of Eve Moskowitz’s Success Network schools – sometimes at the expense of traditional public schools.)

The latest issue of Educational Policy has some research on this very topic by Yongmei Ni (Ni is too polite to call it “creaming” and uses the low-fat term “sorting.”): “The Sorting Effect of Charter Schools on Student Composition in Traditional Public Schools.” (here gated – I found it thanks to a tweet by Shankar Vedantam)

From the abstract:

the dynamic student transfers between charter schools and TPSs are analyzed through a series of hierarchical generalized linear models. The two-way transfer analysis shows that the student sorting under the charter school program tends to intensify the isolation of disadvantaged students in less effective urban schools serving a high concentration of similarly disadvantaged students. [emphasis added]

The problem has no easy solution.  The solution for the individual is clear – get your kid into the best school possible.  But for the system, this creaming solution makes the most disadvantaged schools more chaotic, more hopeless.

Screen Gems

August 15, 2012
Posted by Jay Livingston

The film is “Staten Island.”  I pushed the “Info” button on the Verizon FIOS remote to see what it was about.

I actually checked a review at MRQE to make sure that the character was not some speechless but nevertheless supercool dude.


It makes me wonder where Verizon get its little film blurbs anyway. Someone has to be writing these things. 

There are those who will wring their hands and see this as yet a further debasement of the language, a creeping illiteracy, and the end of civilization as we know it.  But surely there is some more interesting linguistic relevance.  Does it show the pervasive influence of hip-hop diction? 

Anyway, it has inspired me to begin work on my novella – a tale of an aging but blocked writer who goes to Italy.  He hangs out in the Piazza San Marco, falls in love with the youthful hip-hop culture there, and winds up freestyling in local trattorie.  The title – and I call first dibs on it – “Def in Venice.” 

Oh, Those Europeans – Supporting Single Parents

August 14, 2012

Posted by Jay Livingston 

Planet Money is airing segments on the Eurozone problems that arise when you try to have a unified economy but separate sovereign states. If a citizen of France is working in Germany, which country’s laws apply?

I hope this audio clip works, because you really need to hear the bemused bafflement of the American reporters trying to wrap their American minds around the concept of European assistance for single parents. Oh, those wacky Europeans. It’s the same kind of incredulous reaction Europeans might have in learning about, say, Florida’s gun laws.

(If the clip doesn’t work, go to Planet Money and start at that point. The relevant segment goes for about 1:22. I’ve also added an abbreviated transcript at the end of this post.)

The good old American view of welfare is that it should be provided sparingly if at all because it saps people’s industriousness. As we speak, Romney and Ryan are taking Obama to task for letting welfare recipients get off without working. (The Republicans are factually wrong about Obama, of course, but it’s the principle that’s important.) That kind of easy welfare is the way to moral and economic disaster for the individuals and the country at large. Charles Murray takes a similar view of single parenthood. If the government subsidizes single parenthood, single parenthood will increase,* and it has, bringing with it the economic and moral debasement of the White working class.

Surely, France and Germany, with their generous support of single parents, must be disaster zones. But no, they are among the strongest economies in Europe – Germany is surely the strongest. The unemployment rate in Germany is 5.4%, well below that of the US.

It is possible that support for single parents has taken the lock out wedlock, allowing mothers to escape bad marriages, and allowing pregnant women to avoid being forced into bad marriages.

(Click on the chart for a larger view.)

The proportion of children born out of wedlock has increased generally. But Germany, with its generous benefits, has seen a much lower increase than has the US. The rate in some other countries, the Netherlands or Norway, for example, has increased greatly.  (I cannot quickly find information on how support for single parents has changed in any of these countries.)  As for the impact of single-parent benefits on the economy, that requires much more complex analysis, controlling for a host of other variables. But at first glance at charts like this, the connection is hard to see.  Low-rate countries like Spain and Italy are not in such great shape economically.  And Japan, even before the current financial crisis, had experienced its economic “lost decade.” 

----------------------------
 * Conservatives take a similar view of unemployment benefits, which they label “paying people not to work.”

Edited transcript.  The Planet Money reporters are Zoe Chace and Robert Smith

ZOE CHACE:  There was also this totally European but really fascinating story they told us about the French single mother.  She’s living in France and working in Germany.
ROBERT SMITH: In France, when you have a kid, as a single parent, you get help from the state till the kid turns eighteen.  In Germany though, a single mom gets state assistance until the child is [slowly, for emphasis] twenty-five years old.  That’s not even a kid any more [laughing], he’s a full adult, but that’s the way Germany works.  You get assistance till your child is 25 years old.
The legal question was whether the woman should get benefits under the French system or the German.
I, I know it’s confusing, believe me – the court thought it was confusing too –but what it boiled down to is this:  Germany is paying a French woman German money because the French law wasn’t good enough.  It didn’t provide enough benefits.