Excellent article on the need to transport energy

The New York Times just published an excellent analysis about the conflict between our need to move large amounts of energy from where it can be found to where it will be used----whether it be electricity, oil, or natural gas---and obstruction by environmentalists and NIMBYites of efforts to build transmission lines and pipelines. Read it here.

This letter was NOT published by the Wall Street Journal

My previous entry (below) about a letter published by the Wall Street Journal has a story behind it. The same day the WSJ ran the op-ed (one of many recently) encouraging us to attack Iran it also ran a piece about the fight between the Obama administration and religious groups about the Administration's decision (since weakened) to require hospitals and universities run by religious groups to provide "free" contraceptives as part of any insurance coverage provided to employees.

I had to pick which article to comment on, since I knew full well the WSJ would not publish two letters from me at the same time. I picked the birth control issue, sent off a letter, and the very next day the WSJ published a lengthy op-ed piece making exactly the same points I had made in the letter!

So obviously they would not use my birth control letter. I thereupon wrote the letter on Iran which they have indeed published.

In order to avoid totally wasted effort in writing the first letter, here it is.

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In “Obama Seeks Deal on Birth Control” [WSJ, Feb. 8, p. A5], a Hawaiian model

is suggested as a possible compromise: Religious employers could enroll workers in a plan not covering contraceptives, but a reduced premium for the plan (presumably passed along to the employees in their paychecks) would allow “employees who want contraception to pay for the coverage out of their own pockets directly to the insurer.”

It would make more sense for employees wanting contraceptives to just pay for them themselves, eliminating the overhead associated with all money passing through insurance companies. Since only people intending to use contraception would pay for the extra insurance coverage, the additional premium would have to be more than they would pay for the contraceptives.

A critic of any concessions by the Administration is quoted to the effect that “If people can opt out of [paying for] specific services, the whole idea of of insurance falls apart.” Actually, the idea of insurance has already fallen apart when insurance is allowed, let alone required, to cover something like birth control that is a normal operating expense (like food and clothing) rather than an unusual but financially catastrophic expense (like your house burning down or major surgery requiring lengthy hospitalization).

Much of what passes for medical insurance today is actually prepaid expenses and makes sense only because it allows people to avoid paying income tax on substantial parts of their earnings.

Paul deLespinasse

Corvallis, Oregon

Original version of my letter to the Wall Street Journal

Thomas Sowell once said that the fact that he had never killed an editor was proof positive that capital punishment does (sometimes) deter murders. Most of us who write have probably entertained similar desires.

The February 15 edition of the Wall Street Journal includes a letter-to-the-editor that I recently wrote. I appreciate their decision to publish it, but do not appreciate a few "small" but important deletions.

Here is the original version of my letter:

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Charles Robb and Charles Wald claim [“Bolstering the Military Option on Iran,” WSJ February 8] that “the U.S. military is capable of launching a surgical air strike against Iran’s nuclear program and its military installations.” Perhaps, but to believe that such a strike could achieve its goal is wishful thinking at its worst.

Machiavelli warned rulers to avoid injuring their enemies without also destroying their ability to retaliate. We must annihilate or conciliate. A “surgical” strike would do neither and would also violate the “Powell doctrine” that in military actions one should never under-do.

To guarantee Iranian inability to produce atomic weapons would require a massive, bloody and expensive military occupation of the entire country, overthrow of the regime, and prolonged forcible repression of insurgent-style nationalist resistance to the occupation. To incur these costs because Iran might develop and use atomic weapons makes no sense and would never get the necessary sustained support from Americans or our allies.

An alternative, of course, would be for us to use atomic weapons to destroy Iran. But this would kill millions of decent Iranians and is unthinkable if done preemptively.

In the end we are going to have to rely on deterrence, employing atomic weapons as a regrettable necessity only in response to actual Iranian use of such weapons. And it is always possible [Mehdi Khalaji, “It’s Time to Bypass Iran’s Supreme Leader,” WSJ February 9] that Iranians might be able to reform their system if given sufficient time and intelligent support from abroad.

Paul deLespinasse

Corvallis, Oregon

Abandon the concept of illegal alien

In a recent column ["Rethinking Deportation" Oregonian, January 23], Richard LaMountain denounced President Obama's proposed rule that would make it easier for illegal aliens to become legal residents, claiming it will undermine respect for law. But don't immoral rules also undermine respect for law?

What would satisfy people like LaMountain? Would it increase respect for law to load all 12 million illegals into boxcars and deport them, Stalin-like, to Mexico? Or would they prefer to let illegals stay in the U.S. as a permanent underclass, discriminated against by government and denied educational opportunities?

Did it increase respect for law when, in June 2009, a federal jury convicted Walt Staton of littering? His "littering" consisted of leaving jugs of fresh drinkable water in an area near the Mexican border for entering aliens who might otherwise have died from dehydration (as a great many indeed have).

The logic here was impeccable. If more illegal die from thirst, this will make crossing into the US less attractive and reduce the burden of policing the border. Similar logic led Congress to outlaw employment of illegals.

What next? Should we make it illegal to give or sell food to anybody who cannot document that they are a citizen or here with official government approval?

How about allowing or requiring everybody to shoot down undocumented people on the spot? Some soft-hearted Americans might feel this would be going too far.

I guess the real question is: Once we assume that such a category of people as "illegal aliens" is a legal and moral possibility, where do we draw the line in doing something about it?

An alternative which would not require us to draw any such line would be to abandon the whole concept of an illegal alien and regard every human being on the planet as a member of the human race and a citizen of the world. Inside the United States no matter what state we were born in, we automatically acquire state citizenship merely by moving there. Thus I was a citizen of Michigan for 36 years despite having been born in Oregon, and my wife is a citizen of Oregon despite her birth in Connecticut. There is no reason why this system could not work at the world level, and I am sure that at some future time we will have such a system.

In the meantime we have to live with a different system, but we need to recognize just how crazy this system is and the impossible choices with which it confronts us.

Christians, for example, including fundamentalists (perhaps especially fundamentalists!), need to think about the implications of their faith here:

"For I was hungry and you gave me food, I was thirsty and you gave me a drink, I was a stranger and you welcomed me ..." (Matthew 25:35)

Does anybody really want to live in a world where it is illegal to give a fellow human being a drink of water?

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This column has run in the (Portland) Oregonian and on Commondreams.

Double taxation? Nonsense!

Andrew Tobias is treasurer of the Democratic National Committee, so he might be presumed to have it in for Mitt Romney, or any other Republican presidential nominee. However I think he does an excellent job, in today's edition of his blog, of explaining why a lot of the talk about "double taxation" is double talk.

I think his basic point is that you can't argue that rich Americans shouldn't have to pay any income tax on their capital gains because the corporations whose stock furnished their capital gains already paid 35% income tax. You can't simply add the 35% corporate rate (which, as Tobias notes, is mostly theoretical) to the 15% current tax on individuals' capital gains and say those individuals are really paying 50% in taxes. Corporations do not pay ANY capital gains or other taxes on increases in the value of their stock, which is where individual capital gains come from.

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Here is what Tobias writes:

So Mitt Romney pays 14% of his $20+ million annual income in federal income tax. Some have argued this is misleading because it ignores the 35% corporate income tax paid by the companies from which he profited. Add that, they say, and he paid nearly fifty percent.

Nonsense.

Leaving aside the fact that few companies actually pay the full 35% rate, here’s the deal. Say, through his stake in Bain, Romney invested $5 million in a company and, three years later, reaped a $25 million gain. Chances are good that, during the brilliant Bain-engineered turnaround that led to this profit, this company had little or no taxable income. In that case, his share of the corporate income tax paid on that little or no taxable income would also have been little or nothing.

Even if the company had been solidly profitable all three years, those three years’ earnings would have paled in comparison to the realized gain. Right? The company made (say) a 10% pre-tax profit each year – 30% in all. But Bain, in this example, made a 500% profit on its investment, not a 30% profit. So even if the company did pay the full 35% rate on its profits, Romney’s share of that tax would have been little more than a footnote.

The broader point when it comes to any form of “double taxation,” I think, is that – except in egregious cases – I just don’t buy it. Take, for example, the estate tax. Yes, you paid taxes all your life, and now, when you die, your estate has to pay tax again. But we need to get tax revenue someplace, so why not raise some of it from people who truly, categorically, unequivocally don’t need it – because they are dead.

Would it be nice to tell a billionaire’s children they will inherit it all without the government taking half first? Sure, I guess.

(Mitt Romney has pledged to eliminate this burden, shifting it from billionheirs to the less affluent. How can he possibly justify this? The jaw drops in disbelief.)

But for now, only the first $5 million or so of an estate passes tax free, and after that Uncle Sam does indeed get nearly half to help pay for all the things in his budget.

Is there too much spending in that budget? Perhaps. Maybe we don’t need such a large army, maybe we don’t need to honor our debt obligations or issue the Social Security checks people have been promised – but that’s a different topic. Whatever our elected officials obligate us to spend needs to be paid for, either with taxes or borrowed funds. And no matter what kind of budget you would write, if you were Congress, it would require tax revenue.

So the question is: since we need taxes, on whom should we levy them (and for whom should we lower them)? The Romney answer, when Bain and others were lobbying for the 15% rate on hedge fund managers, was: cut taxes on rich hedge fund managers and shift that cost to everyone else. The broader Republican answer has been: cut taxes drastically for the rich – lowering the tax on dividends from 39.6% to 15% and on capital gains from 20% to 15% (Newt would lower them to zero) – and make up the difference by shifting that burden to everyone else (whether via higher taxes, reduced benefits, crumbling infrastructure, or accumulated debt). I can see why some rich people would favor that – but why would anyone else?