Hamilton and Taxation

Alexander Hamilton

Alexander Hamilton (Photo credit: Wikipedia)

Continuing with my review of The Federalist Papers, I’m going to move to a couple of short excerpts from #21 from Alexander Hamilton (did you know his political career was nearly capsized by a sex scandal?). I love this first line:


This is an interesting declaration that I will admit I don’t fully understand. His argument seems to be essentially that there are too many intangibles in determining the true wealth of a nation, which lesson he then turns and applies to the impracticability of imposing a just tax on states. This quick dismissal of any attempt to quantify national wealth seems suspect to me, which is why I think I don’t fully understand this. It may be possible that there are political obstacles to a state tax which Hamilton doesn’t want to address here. He then goes on to examine taxation more carefully:


I also found this interesting. This sounds like an awful lot like a description of the ideals of a free market–that imbalances will organically be corrected, without requiring the constricting oversight of regulation. I suppose this philosophical underpinning in capitalism is unsurprising–Hamilton did become the Secretary of the Treasury, after all. However, my understanding is that Hamilton’s running of said office resulted in more central planning than otherwise.

The Federalist Papers: The Role of Faction

James Madison, Hamilton's major collaborator, ...














A New Vision: The Market as Subservient to Nature


What is needed is not ever more refined analysis of a faulty vision, but a new vision. This does not mean that everything built on the old vision will necessarily have to be scrapped, but fundamental changes are likely when the preanalytic vision is altered. The necessary change in vision is to picture the macroeconomy as an open subsystem of the finite natural ecosystem (environment), and not as an isolated circular flow of abstract exchange value, unconstrained by mass balance, entropy and finitude. . . . .

The major task of environmental macroeconomics is to design an economic institution analogous to the Plimsoll mark–to keep the weight, the absolute scale, of the economy from sinking our biospheric ark.

The market, of course, functions only within the economic subsystem, where it does only one thing: it solves the allocation problem by providing the necessary information and incentive. It does that one thing very well. What it does not do is solve the problems of optimal scale and of optimal distribution. The market’s inability to solve the problem of just distribution is widely recognized, but its similar inability to solve the problem of optimal or even sustainable scale is not as widely appreciated. . . .

Economists have recognized the independence of the goals of efficient allocation and just distribution and are in general agreement that it is better to let prices serve efficiency, and to serve equity with income redistribution policies. Proper scale is a third, independent policy goal and requires a third policy instrument. . . . . The point is that the market’s criterion for distribution income is to provide an incentive for efficient allocation, not to attain justice. These two values can conflict, and the market does not automatically resolve this conflict. The point to be added is that there are not just two, but three, values in conflict: allocation (efficiency), distribution (justice), and scale (sustainability).

–Herman Daly, Beyond Economics

Why Teachers Like Me Support Unions






Methods of Saving Moolah

There’s always these articles in Yahoo! and other such trite sources of information that advise us on ways to save our money. Such as utilizing coupons, driving less aggressively, paying off credit cards with the highest interest first, and other such trivial methods of scraping some extra cash back into the coffers–or, at the very least, simply stemming the flow of money out just that much less.

While those methods, and others, are all important ways to save, I would like to forward some of my own methods of saving cash which I think are more effective. Excelsior!

1) Stop using Mach 3s and dropping $20 every month on razors. Transition into wetshaving (just one upfront initial investment) and you’ll save a lot of cash over the long term. Razors for safety or straight razors are significantly cheaper, and it’s furthermore a more fulfilling shaving experience.

2) Shave your own head. I used to go to SuperCuts or whatever cheap haircut store was around. I kind of liked how sometimes it was a pretty young lass that was cutting my hair. But I also noted that all they ever did was ask me what length of guard they should use on the clippers (as if I was supposed to know). So I realized, eventually, that I could just do it myself. That’s at least $20 in savings every two to four weeks, depending how often you cut your hair. And a pair of clippers is cheap, and they will last you for years. That’s a lot of money saved over the long term.

3) Forgo the gym and go hiking/running/walking. All you need is a pair of shoes. Or invest in a bike.

4) Brew your own damn coffee. I’ve bought a lot of Dunkin’ in my day, and I can attest that it really adds up over the course of a year. It’s the little steady, daily transactions that drain your income. It tastes better at home anyway. And all you need to make your own coffee is coffee and a French press. Forget drip brew; why pay for filters?

5) Hang out at home. You’ve heard of “staycations.” Well, how about “stay ins”? Instead of going out, you stay in. Invite your buddies over. Hang out at the local park. We all need to get out sometimes. But if you make it into only an occasional expenditure, then you will save big time. It’s quite easy to drop $60 in one outing on a few drinks. Drop that $60 on a fine whiskey instead and you could sip at it slowly over the course of a month.

6) Get over yourself and drink tap water.

7) Use the library. Libraries are fucking awesome. You can get nearly any book you want if you are willing to wait for it.

8) Don’t be an organic freak. Buy organic local produce or join a CSA. It’s important to support organic, local, and sustainable use of land. But forget the damn organic cookies and organic cereal. I mean, really. Just let it go.

9) Recognize the difference between luxury and necessity, and make your choices between the two consciously. A car? Sometimes its a luxury or a necessity, depending on where you live. In NYC, it’s a luxury, and an expensive one at that. Movies at the movie theater? Do you really need to see the movie right when it comes out? Is it really better in a movie theater? I find it obnoxiously loud, with way too many trailers and advertisements. In fact, I would rather just read a book. A lot cheaper, and more fulfilling. Sorry movies.

I think that last bullet point is actually the most important one. If you are making your choices consciously, then you are choosing to invest more in certain activities or things because you find them more fulfilling. And thus, it is worth it to you. But there are many things that we throw our money at that are not more fulfilling, and that even degrade our quality of life.

The moral of the story? Spend your money wisely.

Tax, Not Cut

Why is it that whenever a recession occurs (as it inevitably must), a state or municipality suddenly begins proposing to cut the programs that are most needed by those who have the least? These are always programs of health care to the poor or elderly, education to children, and other programs of welfare or of not immediately quantifiable benefit such as arts or music. Why is it that politicians are such cowards that they can’t propose the most logical form of meeting budgetary needs: increased taxes on those who have the most? Why is this so untenable to Americans? Is it simply because they know that the people least likely to complain or raise a fuss are those who don’t have anything to begin with?

Let me repeat: those politicians unable to raise the spectre of taxation are cowards. Funding to programs that are essential to people should not be subject to economic whim. Education should never have its funding cut. Never. Health care programs and preventative care programs and family planning programs should never have funding cut. Never. Welfare programs should never have funding cut. People rely on that welfare and need it for day-to-day existence.

Tax the rich and distribute that money equitably in order to continue funding for essential services and programs. Why is that such an unrealistic objective to achieve?

New Paradigm

You may have noted that I have been relatively quiet on the political/news front as of late, mostly because I don’t have any free time anymore, but furthermore because I think that most of the events, such as Obama’s inauguration, speak for themselves and we are all somewhat inspired and hopeful for the future, finally. But there are a few things that I want to say about the pressing economic and political events of our time.

First of all, former George W. Bush’s presidency was a complete and abject failure. Please, let’s not forget that. There have been a lot of interviews and articles before the switch-over that offered a somewhat benign retrospective of Bush’s reign, and it looks like reporters have been attempting to remain “objective” by entertaining the notion that Bush may have represented integrity because he never backed down from doing whatever the fuck he wanted, or something like that.

Bush was a terrible mistake, and a giant mar on the already besotted history of US politics. He stood as a representative not of personal integrity, but rather as the exact negative of what a leader should be. He didn’t listen to his opponents nor his own constituency. He didn’t utilize diplomacy in dealing with world bodies and foreign leaders. He took more vacations than any other president in history. His administration was peppered by yes-men, neo-cons, and nepotism. This is completely ignoring the myriad scandals that marred his administration. Basically, he didn’t do anything that he was supposed to do as a LEADER. The real “leadership” in the Bush presidency were the people who actually ran things, such as his vice-president and Karl Rove. Presidents in the past have oft been puppets on strings, such as Reagan, but at least Reagan had charisma and could instill some kind of false confidence, even when his actual policies resulted in terrible outcomes that we are still paying for today.

So yes, thank god we have closed that terrible chapter in our history. But we will be continuing to pay for those 8 years of bullshit for a long time hence, Obama or not. The Republican Party, as evidenced by their cold response to bipartisanship in the passing of the stimulus plan, are awaiting an eventual rebuttal to the centrism of the Obama presidency. They will do all they can do to ensure that his policies fail, so that they can renew their onslaught of the poor and middle class. Bear that in mind in the coming years: W. Bush was not an anomaly. He was the epitome of hard-line right-wing divisiveness. And again, let me be perfectly clear about the policies of such an administration: they failed. Period. They will never be effective. The myth of free market capitalism has been—with finality—debunked.

The history that Obama has made in his ascendance to the American presidency is not simply about a black man becoming a US President, nor reductively about simple “change”: it is about the forceful backing of an American public for a government that will utilize its policies for greater control and responsibility of economic tides. A government that does what it is supposed to do, rather than absolving itself of any and all responsibility beyond that of blatant militarism.

Now I want to discuss these “tough economic times,” as they like to say everyday on the news. This is indeed a time when the failed economic policies of the past are coming home to roost. This is also a time when “the American people” are beginning to pay for their years of living wantonly off of money that they never had and never will have. This is a time when issues of sustainability are no longer simply concerns of hippies, but of academic professors and Washington policy wonks. This is a time when America has to wake up to the fact that we have been sleeping, while the rest of the world has been quietly surpassing us in their investment in business and educational competitiveness.

Even though comparisons to the Great Depression can be fruitful simply for waking up people to the fact that this recession is real and its effects on people devastating, let’s also abstain from going too far. No one is jumping out of windows on Wall St. The lines for unemployment may be exceedingly long, but there’s no extensive lines for soup kitchens, at least, not yet. Retail chains that have stretched themselves too thin on the promise of endless sales have indeed been shutting their doors. Banks are decisively slimming their ranks with a butcher’s knife. And this impact cannot be understated on the economy nor on men and women now without salaries. But for many, it also doesn’t mean much of anything other than that they won’t waste their money like they might have before. And that’s not necessarily a bad thing.

Because the fact is that transitioning into what they call a “green” economy can not be easy, nor even possible without the recognition that it is necessary. These “tough economic times” are not about a housing market bubble collapsing, nor about over-investment in bad securities and over-lending of easy credit: it is about the transition into a new economic and political and social paradigm. A paradigm in which we recognize our interdependence on each other and other nations, acknowledge the interconnectivity of mankind with that of the earth, and begin to take responsibility for the actions not only of ourselves, but of our governments and world bodies.

So as tough as these times are—and yes, these times are tough for me personally, thank you very much—they are also a necessary time for buckling down and gaining a clearer vision of what we need to achieve.