The Lamest Generation

Writing in Psychology Today, Professor Peter Gray notes that today’s college students are increasingly needy, emotionally fragile, and lacking in “resilience” and “grit.” Many of them are simply unprepared for college in terms of emotional maturity. The problem is getting so bad that it’s becoming a burden for professors, and threatening to undermine the mission of the university.

[W]e learned that emergency calls to Counseling had more than doubled over the past five years. Students are increasingly seeking help for, and apparently having emotional crises over, problems of everyday life. Recent examples mentioned included a student who felt traumatized because her roommate had called her a “bitch” and two students who had sought counseling because they had seen a mouse in their off-campus apartment. The latter two also called the police, who kindly arrived and set a mousetrap for them.

More evidence also that we have too many cops.

For the professor, these students are taking the fun out of teaching.

Faculty at the meetings noted that students’ emotional fragility has become a serious problem when it comes to grading. Some said they had grown afraid to give low grades for poor performance, because of the subsequent emotional crises they would have to deal with in their offices. Many students, they said, now view a C, or sometimes even a B, as failure, and they interpret such “failure” as the end of the world. Faculty also noted an increased tendency for students to blame them (the faculty) for low grades—they weren’t explicit enough in telling the students just what the test would cover or just what would distinguish a good paper from a bad one. They described an increased tendency to see a poor grade as reason to complain rather than as reason to study more, or more effectively.

Some campus meetings attended by Prof. Gray produced the following distressing points.

  • Less resilient and needy students have shaped the landscape for faculty in that they are expected to do more handholding, lower their academic standards, and not challenge students too much.

  • There is a sense of helplessness among the faculty. Many faculty members expressed their frustration with the current situation. There were few ideas about what we could do as an institution to address the issue.

  • Students are afraid to fail; they do not take risks; they need to be certain about things. For many of them, failure is seen as catastrophic and unacceptable. External measures of success are more important than learning and autonomous development.

  • Faculty, particularly young faculty members, feel pressured to accede to student wishes lest they get low teacher ratings from their students. Students email about trivial things and expect prompt replies.

  • Failure and struggle need to be normalized. Students are very uncomfortable in not being right. They want to re-do papers to undo their earlier mistakes. We have to normalize being wrong and learning from one’s errors.

How did we get ourselves into this fine mess? Prof. Gray has a plausible explanation: the ‘helicopter society.’

“[H]elicopter parenting really is at the core of the problem. But I don’t blame parents, or certainly not just parents. Parents are in some ways victims of larger forces in society—victims of the continuous exhortations from “experts” about the dangers of letting kids be, victims of the increased power of the school system and the schooling mentality that says kids develop best when carefully guided and supervised by adults, and victims of increased legal and social sanctions for allowing kids into public spaces without adult accompaniment. We have become, unfortunately, a “helicopter society.”

Back in 2004, Michael Barone published a book called Hard America, Soft America. Barone pointed out that America produces the most incompetent 18-year-olds, but the most competent 30-year-olds, in the world. All these college kids are still closer to 18 than to 30. Hopefully, by 30 they’ll have grown up. Otherwise, this country is in big trouble.

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Great Socialists in History: No Such Thing

Dorothy who??

[Socialist] Vermont Sen. Bernie Sanders lauded Pope Francis for highlighting Dorothy Day — a Catholic socialist — and for calling for action on climate change and poverty in his speech to Congress on Thursday.
In an interview with CNN’s Dana Bash, Sanders, a Democratic presidential candidate, said Day “spent her life fighting for the poor and fighting for justice”…

“She was a very, very progressive … socialist who organized working people and the poor to stand up to the wealthy and the powerful and to fight for social justice,” Sanders said.

But who did more for working people, socialist Dorothy Day, or capitalist Thomas Edison? Socialist Dorothy Day, or capitalist Henry Ford?

Hint: Before Henry Ford revolutionized the auto industry, a car cost more than a house.

Sometimes people who do great things, like Norman Borlaug, get unfairly overlooked by history. But in the case of Dorothy Day, there are good reasons why almost nobody has heard of her.

An old saying is that the shortest book ever written is Great Moderates in History. Actually, an even shorter book would be Great Socialists in History. The fact is that there exists no person known to history for his or her socialism who could be considered a great person worthy of adulation. At worst, history’s socialists are mass murderers like Stalin, Mao, and Che Guevara. In The Lost Literature of Socialism, historian George G. Watson asserted that every writer during the century 1840-1940 who advocated genocide or ethnic cleansing was a socialist.

At best, history’s socialists are losers and nobodies like Dorothy Day.

And the very obvious reason that history records no successful socialists is that socialism has failed everywhere it’s been tried.

The fact that socialists like Sanders and Pope Francis laud a socialist nobody like Dorothy Day, rather than successful capitalists like the Wright Brothers or Walt Disney or Steve Jobs, tells you everything you need to know about them.



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Bernie Sanders vs. Abraham Lincoln

Candidate Bernie Sanders, in an appearance last week at Liberty University, declared that the United States was founded upon racist principles.

And I will also say, that as a nation — the truth is a nation that in many ways was created, and I’m sorry to have to say this from way back, on racist principles, that’s a fact.

Well. It so happens that the principles on which the nation was founded are expressed in the Declaration.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

Since the rights belong to “all men,” this principle is not racist; in fact, it is the antithesis of racism. Now, it is true that back in the 19th century some defenders of slavery like Stephen Douglas and Roger Taney tried desperately to argue that “all men” did not really mean all, but just white men or even just Englishmen. This pathetic attempt to argue that “all” doesn’t really mean all was blown out of the water by Abraham Lincoln.

Here’s what Lincoln said in his 1857 speech on the Dred Scott decision.

Chief Justice Taney, in his opinion in the Dred Scott case, admits that the language of the Declaration is broad enough to include the whole human family, but he and Judge Douglas argue that the authors of that instrument did not intend to include negroes, by the fact that they did not at once, actually place them on an equality with the whites….And this is the staple argument of both the Chief Justice and the Senator, for doing this obvious violence to the plain unmistakable language of the Declaration. I think the authors of that notable instrument intended to include all men…They defined with tolerable distinctness, in what respects they did consider all men created equal-equal in “certain inalienable rights, among which are life, liberty, and the pursuit of happiness.” This they said, and this meant. They did not mean to assert the obvious untruth, that all were then actually enjoying that equality, nor yet, that they were about to confer it immediately upon them. In fact they had no power to confer such a boon. They meant simply to declare the right, so that the enforcement of it might follow as fast as circumstances should permit. They meant to set up a standard maxim for free society, which should be familiar to all, and revered by all; constantly looked to, constantly labored for, and even though never perfectly attained, constantly approximated, and thereby constantly spreading and deepening its influence, and augmenting the happiness and value of life to all people of all colors everywhere…

Now let us hear Judge Douglas’ view of the same subject, as I find it in the printed report of his late speech….

“They were speaking of British subjects on this continent being equal to British subjects born and residing in Great Britain!” Why, according to this, not only negroes but white people outside of Great Britain and America are not spoken of in that instrument. The English, Irish and Scotch, along with white Americans, were included to be sure, but the French, Germans and other white people of the world are all gone to pot along with the Judge’s inferior races. I had thought the Declaration promised something better than the condition of British subjects; but no, it only meant that we should be equal to them in their own oppressed and unequal condition. According to that, it gave no promise that having kicked off the King and Lords of Great Britain, we should not at once be saddled with a King and Lords of our own.

I had thought the Declaration contemplated the progressive improvement in the condition of all men everywhere; but no, it merely “was adopted for the purpose of justifying the colonists in the eyes of the civilized world in withdrawing their allegiance from the British crown, and dissolving their connection with the mother country.” Why, that object having been effected some eighty years ago, the Declaration is of no practical use now-mere rubbish-old wadding left to rot on the battle-field after the victory is won.

Does Bernie Sanders disagree with Lincoln about the Declaration? Does he agree instead with the racist Taney that the plain language referring to “all men” does not really refer to all men? Does he agree with Stephen Douglas that the purpose of the Declaration was merely to effect separation from Britain, and that the Declaration therefore did not contemplate “the progressive improvement in the condition of all men everywhere?”

Bernie Sanders is entitled to his opinion, but personally, we’re sticking with Lincoln.

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Bernie Sanders Doesn’t Know Shit about Economics: An Ongoing Series

Sanders_wageThe claim that real income was somehow higher 40 years ago is one of the most frequently bruited economic fallacies. As we pointed out before, the claim relies on a faulty computation of the change in the cost of living, due to the fact that price indexes tend to over-estimate the rate of inflation. For more details on the relevant computations, refer to our previous post.

But leaving aside the math, Bernie Sanders like us is old enough to remember the 1970s, and therefore he should know that the idea that the standard of living was higher at that time is patently absurd. There is just no way the “typical male worker” earned more in real terms in 1973 than in 2015.

And the biggest problem for the 1973 worker was that he had to spend his money in 1973 which means only purchasing the goods available in 1973. That means no personal computer, no cellphone, no iPod, no internet, no DVDs. Microwaves and cable TV existed, but almost nobody had them.

People in 1973 did believe economic fallacies, but nobody tweeted them.

Working in 1973 also meant purchasing only 1973-quality healthcare. So that if the “typical male worker” suffered a typical heart attack, he was three times more likely to die in 1973 than today.

Nobody in his right mind would want to go back to the economic conditions of 1973. Social conditions, maybe, but not economic conditions.

James Lileks has a great post mocking the merchandise offered in the 1973 edition of the Sears catalog. We’ve taken the liberty of borrowing some of his pics and comments. Since a picture is worth a thousand words, let’s check out some of the goods available for purchase in 1973.

First up, horrible plastic shoes.

13Leaving aside the hideous fashion, consider Lileks’ assessment of the quality of these shoes.

The key word, and your guarantee of comfort: “Smooth vinyl upper.” That’s right: plastic shoes. Your foot was swimming in moisture by the end of the day; you’d take these things off and the bird would fall off its perch.

The plastic was noted for cracking after a few months, and the heels came apart as well. The toes didn’t just scuff – they became abraded, and no amount of polish could resurrect them.

Keep in mind also that the shoes were not as inexpensively priced as they appear. In 1973, the average hourly wage in manufacturing was $4. Today it is $21. So in wage units, paying $11 in 1973 would be like paying $57 today. For plastic shoes.

Next, check out the price on this vacuum cleaner.

16$189.95? That sounds like a price we might pay today. But remember, wages in 1973 were less than one-fifth of today’s level. This would be like paying $1000 for a somewhat-lame vacuum cleaner.

18“Our $88.95 Electronic Calculator” In wage units, today that would be $467, which is more than we paid for our laptop. For a device that only adds, subtracts, multiplies, and divides. Not even any logs or trig functions.

Bernie Sanders doesn’t know what he’s talking about. Oh well, what can one expect from a self-proclaimed socialist?


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Dems Throw Jefferson, Old Hickory Under the Bus

State and local Democrat organizations across the country have traditionally held annual “Jefferson-Jackson” fundraising dinners, named after two historical heroes associated with the early years of the party. Jefferson and Jackson, however, both owned slaves, and engaged in other troubling activities involving race. And so Democrats, in an intellectually immature fit of moral pique, are now jettisoning their own history by dropping the Jefferson-Jackson name from their annual dinners. In just the last few months, local Democrat organizations have now taken this step in several states.

Democratic parties around the country have long titled their annual dinners “Jefferson-Jackson,” but there has been a recent move away from that name. According to an article in The Atlantic and other news reports, at least four states — New Hampshire, Connecticut, Missouri and Georgia — have changed the name of their dinners. Party leaders in South Carolina, Iowa and Tennessee are also considering changes.

In addition to the four states listed above, Florida and Maine have also dropped the Jefferson-Jackson label from their annual meetings. The pending change in Tennessee is particularly significant since Tennessee is Andrew Jackson’s home state.

Every political movement needs heroes, but if Democrats are now unwilling to honor anyone tainted by racial discrimination, then most of the history of their party will offer up few worthy names. That’s because virtually every prominent Democrat in America until about 1960 supported either slavery or racial segregation. Consider just a partial list of the historical lowlights.

  • 1865 sees the founding of the KKK, an organization described by eminent historian Eric Foner as “a military force serving the interests of the Democratic party.”
  • 1868. Republicans in Congress pass the 14th Amendment, granting full citizenship to blacks. No Democrats vote in favor.
  • 1915. Democrat President Woodrow Wilson, an out-and-out white supremacist, praises the film Birth of a Nation and holds a private screening in the White House. The film is a glorification of the KKK.
  • 1922. An anti-lynching law proposed by Republican Rep. Leonidas Dyer of St. Louis, and endorsed by Republican President Warren Harding, passes the House but can’t overcome a Democrat filibuster in the Senate. In 1938, left-liberal icon Franklin Delano Roosevelt sides with Southern Democrats in opposing a similar bill. A 1947 anti-lynching bill is again blocked by Democrats in Congress, including future president Lyndon Baines Johnson.
  • 1924. At the Democrat national convention in New York, a resolution condemning the KKK is proposed, but voted down by the delegates. One young delegate is so appalled by the vote that he quits the party and becomes a Republican. Sixteen years later that man, Wendell Willkie, becomes the Republican nominee for President of the United States.
  • 1937. FDR appoints Hugo Black, a former KKK member, to the Supreme Court of the United States. Black’s legal resume includes serving as defense attorney for a Klansman accused of murdering a Catholic priest. After obtaining an acquittal, Black becomes a hero to the Klan.
  • 1963. Bull Connor, a city Commissioner in Birmingham, orders the use of fire hoses and attack dogs against civil rights protestors. Connor was not just a Democrat; he was a member of the Democratic National Committee.
  • 1981-1989. Senate Democrats elect and support as their leader Senator Robert C. Byrd of West Virginia. As a young man, Byrd was not just a member of the KKK, but attained the rank of Exalted Cyclops and founded and recruited his own local KKK chapter.

But hey, that stuff occurred a long time ago, so maybe Democrats can find some suitable heroes among their more recent presidents and near-presidents, like Jimmy Carter, Bill Clinton, and Al Gore.

In this respect, Democrats just need to look past the rumors that Carter’s father was a Klansman, and the fact that during his presidency his mother, Lillian Carter, was caught ‘watching’ a Klan rally in Georgia. Dems surely can also overlook the fact that Al Gore’s father voted against the 1964 Civil Rights Act, and that Bill Clinton’s mentor, Senator William Fulbright, was a segregationist who voted against the Civil Rights Act.

Well, maybe there’s a reason why Florida Democrats chose not to rename their annual dinner for anyone. The function is now known as Leadership Blue Weekend.

Democrats–they promise to lead us all to a blue weekend.

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Great Friedman Quotes

The late Milton Friedman was one of the greatest economists of the 20th century and an inspiration to the authors of this site. In honor of Friedman’s 103rd birthday last week, John Hawkins put together a list of Friedman’s “20 best quotes.” Hawkins’ list includes many of our personal favorites, which come in handy when debating leftists.

20) “A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both.”

18) “It is one thing to have free immigration to jobs. It is another thing to have free immigration to welfare. And you cannot have both. If you have a welfare state, if you have a state in which every resident is promised a certain minimal level of income, or a minimum level of subsistence, regardless of whether he works or not, produces it or not. Then it really is an impossible thing.”

17) “So that the record of history is absolutely crystal clear. That there is no alternative way, so far discovered, of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system.”

6) “The great virtue of a free market system is that it does not care what color people are; it does not care what their religion is; it only cares whether they can produce something you want to buy. It is the most effective system we have discovered to enable people who hate one another to deal with one another and help one another.”

4) “There are four ways in which you can spend money. You can spend your own money on yourself. When you do that, why then you really watch out what you’re doing, and you try to get the most for your money. Then you can spend your own money on somebody else. For example, I buy a birthday present for someone. Well, then I’m not so careful about the content of the present, but I’m very careful about the cost. Then, I can spend somebody else’s money on myself. And if I spend somebody else’s money on myself, then I’m sure going to have a good lunch! Finally, I can spend somebody else’s money on somebody else. And if I spend somebody else’s money on somebody else, I’m not concerned about how much it is, and I’m not concerned about what I get. And that’s government. And that’s close to 40% of our national income.”

3) “Indeed, a major source of objection to a free economy is precisely that it… gives people what they want instead of what a particular group thinks they ought to want. Underlying most arguments against the free market is a lack of belief in freedom itself.”

11) “I am in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible.”

Unfortunately, the great majority of economists, present company excluded, would dissent from that last quote. And why is that? Our best guess is naïveté about government.

All of the quotes are controversial, which is what makes them thought provoking and not pedestrian, but even many libertarians seem to reject number 18, in particular.

Hawkins’ list is good, but he missed at least one of our favorites, to which we’ll assign number 21.

21) “In this world, the greatest source of inequality has been special privileges granted by government.”

Finally, number 17 is from a television show in which Milt takes Phil Donahue (who started his career in Dayton) to school. The excerpt from the show is always worth rewatching if only for the puzzled expression on Donahue’s face.

China’s official GDP charade is in—and, surprise! It’s 7%

A story from Reuters about China’s Madaoff- style economic track record:

Defying all expectations, China’s GDP grew 7% in the second quarter—at least according to the official charade.


It is an official charade because China’s GDP has long been recognized as a distorted measure of the country’s economic growth. The value “created” in the country’s economy is inflated by the fact that a good chunk of the stuff bought and built in China isn’t worth the official sticker price.

This is thanks to the government’s “implicit guarantee” of any investments that are political priorities. This gives investors, both corporate and individual, the confidence that the government will bail out any inconvenient losses. It encourages banks and individual savers alike to lend to wasteful projects, as long as an official imprimatur is looped in somewhere. It lets lenders accept these unprofitable projects at face value as collateral for more loans.

And thus, debt begets more debt—China’s nearly quadrupled from 2007 to mid-2014, to $28 trillion, McKinsey calculates. Outstanding loans using property as collateral now add up to 22 trillion yuan—about 40% of the total—according to Fitch, the ratings agency. That’s about five times what they were in 2008.

In a way, China’s quarterly GDP announcement is the meta-example of the implicit guarantee creating a moral hazard.

The Chinese government is the only major economy to set GDP growth targets each year. Throughout the year, government officials and the state press reiterate, or talk down, that GDP growth target depending on the political agenda. In decades past, these signals let local officials know how recklessly they should invest, or how brazenly they should lie about the results.

This illustrates that there is no sensible way to measure the value of output or growth in a quasi-command economy.  An old joke in China is that the government can hit whatever GDP number it wants by 1. Building a bridge and 2.knocking down the bridge, and 3.Building the bridge ……………..

The government is coming for your handmade soap

Here is the story from Legal Insurrection:

As if there weren’t more important things to be concerned about…

Lawmakers are considering legislation that would further regulate cosmetics including handmade soap. The Personal Care Products Safety Act was introduced by Sen. Diane Feinstein (D-Cal) and Sen. Susan Collins (R-Maine) last month. The bill is currently rattling around in the Committee on Health, Education, Labor, and Pensions.

The stated purpose of the bill is to, “protect consumers and streamline industry compliance by strengthening the Food and Drug Administration’s (FDA) authority to regulate the ingredients in personal care products. While the personal care products industry is projected to exceed $60 billion in U.S. revenue this year, federal regulations on these products have not been updated in 75 years.”

So basically, “I can’t believe we let this industry make all this money without taking more and more of it in 75 years!”


Essentially, the Personal Care Products Safety Act is another venture in big government glut that would expand the FDA’s jurisdiction thereby creating more bureaucracy, wasting taxpayer money, and hindering small business growth. More specifically though, the bill would impose fees, and add ridiculous reporting and labeling requirements.

Sen. Feinstein boasts support from just about every big cosmetic industry player including:

  • Personal Care Products Council (a trade association representing more than 600 companies in the industry)
  • Johnson & Johnson (brands include Neutrogena, Aveeno, Clean & Clear, Lubriderm, Johnson’s baby products)
  • Procter & Gamble (brands include Pantene, Head & Shoulders, Clairol, Herbal Essences, Secret, Dolce & Gabbana,
  • Gucci, Ivory, Cover Girl, Olay, Sebastian Professional, Vidal Sassoon)
  • Revlon (brands include Revlon, Almay, Mitchum)
  • Estee Lauder (brands include Estée Lauder, Clinique, Origins, Tommy Hilfiger, MAC, La Mer, Bobbi Brown, Donna Karan, Aveda, Michael Kors)
  • Unilever (brands include Dove, Tresemme, Lever, St. Ives, Noxzema, Nexxus, Pond’s, Suave, Sunsilk, Vaseline, Degree)
  • L’Oreal (brands include L’Oréal Paris, Lancome, Giorgio Armani, Yves Saint Laurent, Kiehl’s, Essie, Garnier, Maybelline-New York, Vichy, La Roche-Posay, The Body Shop, Redken)

So it’s pretty much classic regulatory capture. Big firms support it because they can afford it, and it’s too expensive and drives the little firms out of business, preventing any of these little firms from disrupting the industry. Few people catch on to this, and most will think these laws are looking out for the little guy.

Six Lies about U.S. Schools (Bumped)

At, Joy Pullmann puts together a good list of “Six Lies Most People Believe about U.S. Schools.” We have to agree in particular with lie number 1 on the list:  “America’s rich, suburban schools are high quality.”

The Global Report Card has recently layered specific, nationwide figures upon broader comparisons that have long demonstrated our mediocrity. Its authors give Beverly Hills as one example. It represents most affluent suburban districts, which Americans typically think contain great schools. But they don’t. “If Beverly Hills were relocated to Canada, it would be at the 46th percentile in math achievement, a below-average district. If the city were in Singapore, the average student in Beverly Hills would only be at the 34th percentile…” The schools everyone thinks are so great are only so because we compare them to our truly awful urban districts, rather than to actual peers.

Unfortunately, our own personal experience concurs with this assertion. We are constantly coming across students who attended allegedly good high schools but who nonetheless demonstrate a poor grasp of proper high school material. In one recent case, a student, while sitting in our office, related to us that his parents moved to the suburbs precisely so that he would not need to attend the awful Chicago city schools. But only moments later, this same student, while going over some economics problems, revealed a distinct lack of proficiency with middle school (not high school–middle school) level math.

Further evidence that suburban schools are deficient is the fact that, as reported previously on this site, the proportion of high-school seniors who test proficient in U.S. history is only 12%. For the figure to be this low there must be an awful lot of above-average students at above-average schools who are not learning what they’re supposed to.

Apparently, parents are either not willing or not able to judge their children’s schools on the basis of academic substance. It seems that parents judge the school “good” so long as the child seems reasonably happy, and the child doesn’t get pregnant, or victimized by crime, or fall in with the stoner crowd. Talk about defining success down.

We could say a lot more, but it’s usually better to let Milton Friedman do the talking. Here is Friedman’s classic video, “What’s Wrong with our Schools?”

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Redistribute GPAs? (Updated)

In chapter three of The Road to Freedom, Arthur Brooks points out that many of his students at Syracuse University believed that the government should redistribute wealth from rich to poor. Brooks proposed to the students the following idea. He would “take a quarter of the points earned by the top half of the class and pass them on to the students in the lower half of the class.” Despite their support for wealth redistribution, the students “were in unanimous agreement that this was a stupid idea.” Of course, but what’s the difference between grade-point redistribution and wealth distribution? If redistributing GPAs is wrong, doesn’t it follow that redistributing wealth is also wrong?

Turns out that Brooks is not alone in making this analogy, and many students have taken the opportunity to post amusing Youtube videos in which their fellow students struggle to explain why they support redistribution of wealth but not GPAs.


The GPA analogy must have hit a nerve, because “progressive” students got out their video cameras to make responses. Check out this reply by the young tax experts at something called TYT (The Young Turks) University.


To the best we can discern, the young people in this video make two main points.

First, the top 1% of rich people are not paying their fair share of taxes, as evinced by the fact that Mitt Romney paid only 13% of his income, while middle-class people typically have to pay a higher rate.

We agree that rich people should pay more in taxes than should middle-class or poor people. But the U.S. tax code is already very progressive. The top 1% of earners account for more than one-third of the income-tax revenue, and the top 10% account for more than one-half.

Furthermore, the 13% figure is grossly misleading. As the Young Turks themselves acknowledge, Romney’s tax rate was relatively low because the vast majority of his income was derived from investments, which are taxed at 15%, lower than the rate on “ordinary” income. What the Young Turks probably don’t realize is that there was a time, years ago, in this country when investment income was in fact taxed at a rate similar to that on ordinary income. That policy didn’t work out very well because the tax deterred investment and didn’t do much to generate revenue. As a result, something like a bipartisan consensus formed to tax investment income–dividends and capital gains–at a lower rate.

Nevertheless, it is not true that investors like Romney are taxed at only 15%, and that is because taxing investment income amounts to double taxation. The money that investors use to purchase securities comes from after-tax income. The money that Romney invested was already taxed–as ordinary income–at the time that he first earned it. If he had immediately blown the money he earned on hookers and booze, he would have owed no further tax. That’s because current consumption is taxed only once. But since Romney invested the money instead of spending it, he’s taxed again. Future consumption is taxed more than once, which creates a distortion and an inefficiency. It follows that the efficient tax rate on investment income is (approximately) ZERO, which happens to be the actual rate in Japan. The Young Turks think 15% is too low, but in fact the rate should be near zero!

Future consumption, however, is not just double taxed, it is triple taxed. That’s because, before the corporations get around to paying Romney his dividends, they must first pay the corporate income tax. At 35%, the U.S. has one of the highest corporate income tax rates of any country in the world. The tax accountants, however, usually find enough deductions so that corporations pay on average about 25%. Still, that means that Romney’s dividends were already taxed at 25% before being payed out to him, and then taxed another 15% when he received them. The combined effect of these taxes is 36.25%, and again, this falls on top of the taxes Romney already paid during the year in which he first saved the money.

Maybe the Young Turks should learn something about our tax system before they upload their thoughts about it to youtube.

The second major point the Turks try to make is that competition in the marketplace, unlike competition for school grades, is fundamentally unfair. Indeed, the female Turk argues that “the 1%” are “mostly bankers” who got rich by “cheating” or otherwise doing unspecified things “that society frowns upon,” and so they do not “deserve” the money that they have. The male Turk then uses bribery as a metaphor to describe how the rich got rich. In short, the whole system, according to the Turks, is rigged.

But can this be true? Did Henry Ford get rich by bribery, or by revolutionizing the auto industry? Did Bill Gates get rich by bribery, or by revolutionizing the computer industry? Was Steve Jobs a crooked banker? Look, nobody said life was fair, and we can always dig up examples of people trying to gain unfair advantage by engaging in various shenanigans. The fact remains, however, that our largely (for now) market-oriented system does, for the most part, reward hard work and ingenuity.

We do find it disturbing that young people in particular should argue that the system is rigged and opportunity a mirage. Young people, with the chance before them to shape their entire adult lives, should be optimistically planning and pursuing their dreams, not whining about how the deck is hopelessly stacked against them. For this failure, some of the blame must be assigned to the schools.

Furthermore, even if we accept the Young Turk argument that people are cheating, how does this justify redistribution? For instance, to pursue their own metaphor, suppose that some people were obtaining high grades by resorting to bribery. In that case, would the obvious solution be to redistribute grades by giving extra marks to those who have not earned them, and in the process perhaps also taking marks away from those who did earn them? Or would the proper response be to, you know, put a stop to the bribery?

And which is the economic system that eliminates getting ahead through ‘bribery’ of one sort or another? Would it be a socialistic system, where government officials have the power to determine who gets what, where, when and how? Or would it be a system of free-enterprise, where everyone is forced to earn their living by competing in the marketplace? If the Young Turks really want a “level playing field,” they should advocate for free markets.

The really interesting thing, however, is that the Turks felt compelled to argue that the rich did not earn their wealth legitimately. Inadvertently, they have effectively conceded the point that wealth earned legitimately should not be redistributed. Since different people have widely varying willingness and abilities to legitimately create wealth, it follows that wide disparities of wealth can exist without justifying distribution, just as wide disparities exist in GPAs. That was indeed the exact point that the GPA analogy was intended to make. As the kids say, “Game over.”

We cannot conclude this post, however, without noting Female Turk’s really jaw-dropping argument that the way the rich “give people opportunities” is by “paying taxes.” Oh, is that where opportunity comes from? Gosh, all these years we thought that rich people gave opportunities by starting and expanding businesses and thereby creating jobs.

Female Turk–another proud product of modern America’s schools.

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