Monthly Archives: September 2009

State tax receipts dive

As of the end of the second quarter, Alabama’s total state tax receipts were down 13 percent from the same point in 2008. Sales taxes were down 10 percent and income taxes were down 24 percent.

Nationwide state tax receipts were down a total of 17 percent. Nine percent of that was sales tax, and 27 percent was income tax.

The numbers, released today, come from the Census Bureau.

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Filed under Recession

‘It’s mine!’

We’re into stewardship season at church. That’s usually a drag, but I’m finding renewed significance in the messages given the political debates in our nation.

The underlying message of every stewardship sermon is no less profound for its repetition. Our stuff is not ours at all. God provided us with the stuff and he can take it away. We can brag all we want about our unique talents or our hard work in acquiring the stuff, but God provided the talents and the drive and the health necessary to accumulate the materials that we value so highly.

When we debate health insurance reform or income redistribution, we prefer to leave God out of the equation. We shouldn’t. Through mandated insurance, the healthy help the sick. Through a public option, the financially comfortable help the 30 million or so people who cannot obtain adequate health care.

But rather than preach Gospel, I want to analogize.

At least in Alabama, not many would openly argue the central stewardship thesis: God gave us everything and he can take it away.

From a secular standpoint, in a democracy, the same can be said of the people. My ability to accumulate material possessions depends entirely on the state, the organized manifestation of the people. My house is titled to me because the people decided to protect my right to private property. The dollars I receive from my employer have value only because the people agree they should. The people could take all of my earnings and return to me only what I need. My talents, such as they are, have value only because the people have assigned them value.

Capitalism achieves its efficiencies through greed, our individual desire to accumulate material possessions. That’s OK, because capitalism usually works. The people allow capitalism to continue, even though most of them get only a tiny portion of the spoils. If they get what they need, they collectively recognize that capitalism has succeeded, despite the inequality-by-design it incorporates.

Just as we recognize that our possessions come from God, however, we are deluding ourselves — from a secular perspective — if we think we “earned” what we have. Our ability to obtain and accumulate come from the people’s decision to enforce those rights. When we refuse to allow 30 million people to obtain adequate health care, we are spitting in the faces of those that consent to our success.

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Filed under Class warfare, Free Market, Government regulation, Health care

Another slap from a foreign bank

BBVA Compass announced today it will eliminate 35 positions in Decatur and 200 in Birmingham. The call-canter positions are being outsourced to Spain-based Atento, a part of Telefonico. See article here.

BBVA, also based in Spain, bought Compass in 2007.

Like Royal Bank of Canada-owned RBC Bank when it bought out Alabama National BanCorporation (First American Bank), BBVA reassured the community it would not be making cuts. RBC laid off two top executives from Decatur, both active in the community.

The main disaster may end up being in Birmingham, headquarters for BBVA Compass. Despite protests to the contrary, BBVA is shifting more and more of its operations to Texas. The call center will at least start in Texas — who knows what overseas home Atento will find tempting. With considerable FDIC assistance, BBVA Compass last month took over Texas-based Guaranty Bank.

Banks operate to make a profit, not to preserve employees. Nonetheless, it is increasingly clear that Decatur residents should not rejoice when foreign money rolls into town.

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Filed under Banks

Unemployment still rising

State Aug. 2009 Rate Aug. 2008 Rate Change from year earlier
Alabama 10.4% 5.2% +5.2
Alaska 8.3% 6.7% +1.6
Arizona 9.1% 5.9% +3.2
Arkansas 7.1% 5.1% +2
California 12.2% 7.6% +4.6
Colorado 7.3% 4.9% +2.4
Connecticut 8.1% 6.1% +2
Delaware 8.1% 5.1% +3
District of Columbia 11.1% 7.2% +3.9
Florida 10.7% 6.5% +4.2
Georgia 10.2% 6.4% +3.8
Hawaii 7.2% 4.2% +3
Idaho 8.9% 5.2% +3.7
Illinois 10% 6.7% +3.3
Indiana 9.9% 6% +3.9
Iowa 6.8% 4.2% +2.6
Kansas 7.1% 4.4% +2.7
Kentucky 11.1% 6.7% +4.4
Louisiana 7.8% 4.8% +3
Maine 8.6% 5.4% +3.2
Maryland 7.2% 4.5% +2.7
Massachusetts 9.1% 5.4% +3.7
Michigan 15.2% 8.6% +6.6
Minnesota 8% 5.4% +2.6
Mississippi 9.5% 7.3% +2.2
Missouri 9.5% 6.2% +3.3
Montana 6.6% 4.6% +2
Nebraska 5% 3.3% +1.7
Nevada 13.2% 7% +6.2
New Hampshire 6.9% 3.9% +3
New Jersey 9.7% 5.7% +4
New Mexico 7.5% 4.3% +3.2
New York 9% 5.7% +3.3
North Carolina 10.8% 6.6% +4.2
North Dakota 4.3% 3.3% +1
Ohio 10.8% 6.7% +4.1
Oklahoma 6.8% 3.9% +2.9
Oregon 12.2% 6.5% +5.7
Pennsylvania 8.6% 5.5% +3.1
Rhode Island 12.8% 8.3% +4.5
South Carolina 11.5% 7.3% +4.2
South Dakota 4.9% 3.1% +1.8
Tennessee 10.8% 6.6% +4.2
Texas 8% 5% +3
Utah 6% 3.4% +2.6
Vermont 6.8% 4.7% +2.1
Virginia 6.5% 4.1% +2.4
Washington 9.2% 5.4% +3.8
West Virginia 9% 4.2% +4.8
Wisconsin 8.8% 4.7% +4.1
Wyoming 6.6% 3.4% +3.2
Puerto Rico 15.1% 12% +3.1

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Free market does not work for health insurance

A reader criticized my Sunday column which pointed out that “death panels” already exist in private health insurance. He correctly suspected that I see significant advantages to abdicating the free market when it comes to health insurance. (I also, for what it’s worth, fear major problems with HB 3200.) He’s a sharp guy, and he made three points. One, he said the problem with health insurance is excessive regulation. States have placed so many restrictions on covereage, he said, that the free market is not working as it should. Two, he correctly pointed out that at least now, consumers can sue their insurance company if it wrongfully withholds coverage. Three, he said voters no longer trust Obama because he constantly proposes solutions that erode at a free market.
Here is my response:
If competition is meaningful, I’m all for it. I agree that government bureacracy tends to mess things up. The free market does not work well for health insurance, though. Read a 20-page Blue Cross policy and an Aetna health policy, look at their premiums, and tell me which is the better deal. OK, you might be able to do it if you spent enough time on the project, but most couldn’t. The free market is fantastic at allocating resources when it comes to commodities, and better than government on almost everything. It is not a good tool, though, when it comes to complex products with hundreds of variables. The reason states have stepped into the insurance issue is that consumers lack the ability to compare policies.
 
Making the free-market approach even more problematic is that the insured rarely is the decision-maker. Usually it is the employer trying to compare apples and oranges.
 
Add 47 million with no health insurance to the already murky free-market approach, and you have a real problem.
 
I agree with you concern about the federal government not being accountable, although I would point out that most deaths are a result not of private insurers ignoring their policies but adhering to them. Legislation could solve the problem.
 
I don’t agree with all that Obama is attempting, but it should come as no surprise that his efforts tend to be contrary to the free market. Governmental intervention is contrary to a free market, so when the government acts, the market is less free. The president has embraced a free market where possible — cap and trade is an example — but implicit in government action is an erosion of the free market. If he supported the free market in all respects, he would do nothing.

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Filed under Government regulation, Health care