Saturday, March 15, 2014

Quote of the day

Timely after the political week past:
Under democracy one party always devotes its chief energies to trying to prove that the other party is unfit to rule — and both commonly succeed, and are right.
– H.L. Mencken
(Hat-tip FFF)

Friday, March 14, 2014

"Insulting the rich for giving to charity"

The Centre for Independent Studies highlights a wonderful example of statistic abuse and nasty statism:

Insulting the rich for giving to charityidea3

Do the rich give too much money to charity or too little? Both, according to an article in the Sydney Morning Herald this week, 'Freedom & Control Are Why the Rich Are Really Charitable.' Remarkably, the article manages to insult the charitable donations of thousands of Australians not once but twice, and in contradictory ways.

The basis for the article is the Tax Office's data for charitable deductions from 2010-11, data which can be interpreted in a number of different ways. The SMH chose to compare donors in the very top band (those making $1,000,000 or more), who gave away an average of 1.8% of their taxable incomes, and those in the very bottom band (those making $6,000 or less), who gave away an average of 22%.

This is a misleading breakdown for several reasons. Those in the lowest tax band who give to charity may give generously, but very few in that band give at all - only 6.3%, compared with 63.8% of those in the top band. If non-donors were included in the calculations for that bracket, the average would come out to 1.4% of taxable income.

Secondly, a large number of those in the $6,000-or-less band are retirees with significant net worth but little income, who, as Professor Myles McGregor Lowndes explains, 'give away substantial amounts so they don't have to pay income tax.'

Both bands came in higher than the national average for charitable deductions, which was 0.35% of taxable income.

These figures hardly justify the SMH reporter's claim that 'the rich pinch their pennies,' and they definitely do not justify Community Council for Australia CEO David Crosbie's assertion in the article that the poor 'feel a sense of collective ownership of our wellbeing,' while the rich 'tend to be more disconnected from the broader community.'

The second half of the article's one-two punch is even more objectionable. The reporter insinuates that the rich actually give too much money to charity, since those dollars would have otherwise gone to the government in taxes.

'Taxpayers cannot control how public funds are distributed but because charitable donations are voluntary, they let people feel in control of at least part of the tax pie,' the reporter writes. She adds: 'Whether individuals are more effective than the government at redistributing wealth is questionable.'

Instead of referring to 'the tax pie' in the above quote, the reporter might more accurately have referred to 'their own money.' The 'control' to which she gives such a derogatory spin is in fact a perfectly laudable desire to put one's donations where they will do the most good, even if that means less for the tax man. The proper response to such generosity is not 'Too much!' or 'Too little!' but simply 'Thank you.'

Helen Rittelmeyer is a policy analyst at The Centre for Independent Studies.

Stating the blindingly obvious

From NCPA today:

Why does the minimum wage fail to alleviate net poverty? Sabia points to two reasons: adverse employment hours and effects, and because few minimum wage beneficiaries actually live in poor households....

...wage increases only redistribute income between poor and near-poor households.


Thursday, March 13, 2014

Ripping off a school

What a couple of first class arseholes these two are:

A principal and her husband siphoned off more than $30,000 from a decile one school in South Auckland and splashed out on themselves.
Rather than the money going towards pupil education at Mayfield Primary School in Otara, Colleen Margaret Gray, 66, and Bruce Kenneth Gray, 65, jetted to Australia and to London.
Colleen Gray also used the school credit card for food at Mecca at Mission Bay and Francoli Bar and Restaurant in Ellerslie.
Part-way through their judge-alone trial in the Auckland District Court yesterday, the Grays admitted defrauding the school of more than $30,000.

It shouldn't matter what decile school it was, or where, but somehow stealing from one of the poorest schools in South Auckland particularly jars.

Can't help wondering though if the funding system whereby the poorest school gets substantially more than the richest leaves more cash available to easily defraud without  detection?

I hope they both get hefty sentences.

Marriage and student loans

The headline of this Acton Institute article implied a problem for the marriages of young people with student loans:

Student Loan Debt is Not Just an Economic Problem, It’s a Marriage Problem

In fact it is about how divorced  parents contribute far less to their offspring's college education (and what the government should do about it.) Coincidentally it reflected a recent conversation I had with a friend. After a marriage break up she had not been able to give her children the sort of financial University support planned pre-divorce. I was explaining (or trying to justify) why we decided to continue to support our oldest rather than expect him to take out a student loan.1/ We can afford to but 2/ more importantly, I don't want to see my children starting out with debt. It can be habit-forming. But it must also influence relationship formation and stability. Which is what I thought the headline referred to.

Anyway back to the Acton piece. It quotes research from Rice University:
 Married parents not only contributed more in absolute terms to their children’s education than divorced parents ($4,700 median amount per year vs. $1,500 per year; p<.001) but also gave a larger proportion of their income to their children’s education (8 percent vs. 6 percent, p<.05). Married parents also outscored remarried parents in absolute ($4,700 per year vs. $2,490; p<.001) and proportional terms (8 percent of income vs. 5 percent; p<.001). Moreover, married parents covered a significantly greater proportion of their children’s financial needs, as defined by the cost of the college in which they are enrolled minus aid. Even as children of divorced and remarried parents were found to have significantly lower levels of financial need, married parents nonetheless covered 77 percent of the financial need of their children, whereas divorced parents covered just 42 percent of the financial need of their children (p<.001) and remarried parents 53 percent (p<.05). Using ordinary least-square regressions to predict parental contributions, the researchers found that parental marital status even trumped parental education and income as the determining factor.
If my theory also holds water, this is yet another example of how marriage breakdowns contribute to overall reduced, probably inter-generational wealth and greater inequality.

Wednesday, March 12, 2014

The politics of child poverty

Over on NZCPD today Muriel Newman writes "Alleviating child poverty"

and my accompanying effort is "The politics of child poverty".

Something about the way the Left is presenting the ‘child poverty’ problem doesn’t stack up. When interviewed, Green co-Leader Metiria Turei repeatedly stresses that 2 in 5 of officially poor children come from working homes. Their parents are doing their best to provide for their children but not making ends meet. It’s unacceptable, she says.
They probably are doing their best and deserve respect for their work effort. Some wages are low and some rents are high. Certainly that presents a problem for those parents. But for Turei and other anti-poverty advocates to continually highlight this group when attempting to influence voters implies there is something less laudable about being benefit-dependent. Not a sentiment normally associated with the Left.
So what’s going on?

Tuesday, March 11, 2014

Communists lament - McCarten will "forestall revolutionary change"

The World Socialist Web Site is so far left that Matt McCarten is right:
McCarten has “a lifetime of service” in defending capitalism by establishing political safety valves to divert unrest in the working class.


Sunday, March 09, 2014

Go for it WINZ

What did you do the last time you found out you'd been successful in getting a job? I remember it well. Returning from the UK in the early 1990s it took an interminable time to find work. When I got the nod, after a number of nopes, I was ecstatic. But I played a mean trick on my Mum. She'd came rushing in  from work anxious to know if I'd heard. I feigned disappointment quickly mirrored in her own face. Then very quickly told her the good news and that I was pulling her leg. My brothers and Dad were all in on the joke.  She's so emotionally transparent sometimes we can't resist pulling her leg. But boy, were we all excited and cheering.

Now that's what I thought people did. They whoop, punch the air, go out for a celebration.That's the real world.

But not according to some miserable types bitching about Work and Income cheering when a client gets a job.

Work and Income office staff are breaking into applause or sounding hooters when beneficiaries find work.
The celebrations have been labelled patronising and embarrassing but Work and Income claims clients enjoy them.

Well I would bloody well love it. Apart from which, aren't those trying to help people find work entitled to celebrate their part in the achievement?

And check out the cartoon Bromhead has created.

THAT is patronising. Applauding someone who has just landed a job, possibly their first ever, isn't.

Solo mother Candice Benson was stunned to see a round of applause erupt after a jobseeker at Work and Income's Lower Hutt office found work on Thursday.
"One of the clients got up to leave and people just erupted into applause," Benson said. "He looked like he was trying to get out of there pretty swiftly," she added. Benson conceded there could be positive intentions but job seekers already felt "humiliated and degraded" and had complex reasons for needing benefits.

Oh get over yourself. If you are at WINZ you are asking for help. You are not in a position to then moan about the way in which it is delivered.

If WINZ was publicly humiliating people who were failing to get work I would be mortified, but celebrating their success???