Pun Salad

For the umpteenth year in a row, nobody offered to pay me a lot of money to watch the State of the Union speech, so I didn't. That's probably a good thing too, since my blood pressure meds might not have been able to keep my arteries intact.

Reader, did you have an over/under bet on how many times President Dotard would use the term "fair share" in his speech? According to the Time magazine transcript, the answer is: five. [UPDATE 2024-03-13: Looking at the NYT transcript, I get six, so we'll go with that.]

Okay, first, the obvious: Corporations don't pay taxes; they collect taxes. The money they send off to the government comes out of the pockets of their customers, employees, and shareholders.

And (see the headline): "fair share" has no economic meaning. It's not as if there's some cosmic formula for determining it.

With respect to #2 above: Someone should ask him: "OK, Mr. 'Capitalist' President. Say I make a million dollars. Exactly how much of that do you think the government should be entitled to?"

Or just buy our Amazon Product du Jour, and say: "Mr. President, could you answer Dr. Sowell's question?"

But I guess "fair share" focus-groups well, as long as you keep it vague.

But particularly galling is Biden's use of "finally" (twice). Implying: "Once we get this, it's final! No more tax increases on anyone!"

Reader, given history, that lie ranks right up there with "Your call is very important to us" and "I have a headache."

Also of note:

• Speaking of lies… Eric Boehm observed: Biden Says He'll Make the Wealthy Pay More To Fix Social Security. Here's Why That Won't Work. Although he didn't spell it out, Biden appears to want to raise or eliminate the "cap" on payroll taxes, that specifies that (currently) "only" the first $168,600 is taxed.

  On its face, this isn't necessarily the worst idea. The cap is completely arbitrary, so there's no principled reason why all earnings shouldn't be treated equally. And there's no doubt that raising the cap would generate more revenue to help keep Social Security afloat. The Congressional Budget Office estimates that applying payroll taxes to higher income levels could raise $1 trillion in revenues over a 10-year period (though the amount of revenue would depend on how the cap was altered, and whether benefits increased as well).

  But there are also serious trade-offs. For one, this would be a tax increase on working Americans to fund a transfer of wealth to retirees. That's not great. A significant portion of that tax increase would fall on people making less than $400,000 annually—remember, the cap is currently set around $168,000—a cohort that Biden promised again in Thursday's speech would not face tax increases.

  Perhaps most importantly, raising or eliminating the payroll tax gap doesn't come close to solving the long-term Social Security shortfall. It might generate $1 trillion over 10 years, which is a lot of money, but it doesn't come close to the $2.8 trillion deficit the program is expected to run over the next decade.

  But when Boehm says "it won't work", he ignores the actual purpose of the proposal: throwing out cheap populist demagoguery. For that purpose, it works fine.

• And speaking of things that won't work… Christian Britschgi observes that Biden's Plan To Subsidize Homebuyers Won't Work.

  America's high housing costs got a brief shout-out in President Joe Biden's State of the Union address tonight, with the president mostly proposing policies that would subsidize demand of this heavily supply-constrained good.

  "I know the cost of housing is so important to you. If inflation keeps coming down mortgage rates will come down as well. But I'm not waiting," said Biden, proposing temporary tax credits of $400 a month to compensate for high mortgage rates and the end of title insurance fees for federally backed mortgages.

  In addition, Biden proposed cracking down on the price fixing of big landlords and urged Congress to pass his plan to build or renovate 2 million affordable homes.

  That housing policy got a shout-out at all in a State of the Union address is somewhat rare, despite housing being the largest line item in most Americans' budgets. Regrettably, most of the policies Biden proposed would do little to address the cause of high housing costs and could make the problem worse.

  "Big landlords" are a convenient scapegoat, of course.

• And one more thing that won't work… Veronique de Rugy points out that A Bipartisan Tax Hike Won't Fix This Deficit. Hey, Vero, why not?

  For one thing, our deficits are the result of excessive promises made to special interests—mostly seniors in the form of entitlement spending—without any real plans to pay. The problem is constantly growing spending, not the lack of revenue and taxes. The common talking point from the left that rich people don't pay their fair share of taxes is a distraction. Not only is our tax system remarkably progressive, but there are not enough rich people to fleece to significantly reduce our future deficits.

  As a 2011 New York Times column by Catherine Rampell reminded us, until then, all deficit-reduction deals were very tax-heavy. What the article didn't mention is that they failed to reduce the deficit. What distinguishes the 1997 deal is that it cut both spending and taxes. The result was the first budget surplus in decades helped by a fast-growing economy. Now, this lesson doesn't mean that a fiscal commission must cut taxes, but it does caution against attempting to reduce the debt largely by raising taxes.

  Spending money is just too much fun for our political class.

• Otherwise, it's business as usual. Eric Boehm (again) dons his green eyeshade and reports: Federal Budget Deal Is Overflowing With $12 Billion of Earmarks. Our state's senior senator makes an appearance:

  Many of the earmarks in the package seem like things that would be better funded by local or state taxpayers, who at least might stand to benefit from projects like new sewer systems, new runways and other upgrades for tiny rural airports, and a plethora of highway projects. Some are truly head-scratching, like Sen. Tammy Baldwin's (D–Wis.) $1.4 million earmark for a solar energy project in Wisconsin, one of the places in America least well suited for a solar farm.

  Plenty of others make no sense for the public to be funding at all. Like a $3.5 million earmark secured by Sen. Debbie Stabenow (D–Mich.) for The Parade Company, which runs Detroit's annual Thanksgiving Day parade. Or the $2.5 million earmark that will help build a new kayaking facility in Franklin, New Hampshire, curtsey of Sen. Jeanne Shaheen (D–N.H.), as well as $2.7 million line item to help build a bike park in White Sulfur Springs, West Virginia, a town with a population of less than 2,300 people.

  For that amount of money, "you could buy EVERY resident a $1,200+ bike" Sen. Rick Scott (R–Fla.), who has become a vocal critic of the earmarks in the bill, posted on X (formerly Twitter). "There's no way they need this much of YOUR money for this."

  I assume "curtsey" is an unchecked auto-complete. But I enjoyed the imagery. There's probably not enough curtseying in the Senate, and who better to do that than Jeanne?