The Great Kansas Reaganomics Experiment Ends In Disaster


Yes, I’m responsible for that smell…Saul Loeb/AFP

❝ When a governor announces an economic theory as a solution to a state’s fiscal problems, while challenging all comers to observe the results, that’s something I want to pay attention to. And so for the past five years, I have been watching the public-policy experiment in Kansas with great fascination.

❝ With the state legislature now rejecting the governor’s experiment, we can move onto to the next phase: Not recrimination and blame, though there is lots of that going around. Instead, I want to look at how the experiment played out, and what lessons there are to be learned from it.

❝ A quick refresher: Kansas’s Republican Governor Sam Brownback pushed through a substantial change in the state tax code, centered around lowering rates. He promised it would lead to more growth, tax revenue and jobs. Instead, there have been persistent tax revenue shortfalls, huge spending cuts and disappointing job creation. As my Bloomberg View colleague Justin Fox wrote, Kansas is badly lagging its neighbors, all of which have similar economies. Even worse, people (especially young people) are fleeing the state. Kansas was one of the highest outbound migration states in 2014, 2015 and 2016. The vast majority of people who have moved out were either transferring when their companies left or were seeking employment elsewhere.

Before Brownback, this wasn’t the case. As recently as 2012 and 2011, Kansas didn’t make the lists of states with high migratory outflows.

❝ Incentives matter: There was a large behavioral incentive, but it was for financial engineering. Brownback eliminated taxes on limited liability companies and sole proprietorships. It isn’t surprising that lots of companies and individuals made these legal structural changes. But this was merely an alteration in form with no beneficial economic incentives.

Set reasonable benchmarks for success or failure: Brownback, despite making large promises, wasn’t specific in how success or failure should be measured…

❝ Have an exit strategy: Because Kansas didn’t focus on specific and measurable benchmarks, it had no way to know when to pull the plug. This is important, as the legislature was forced to wait until things were unequivocally bad and getting worse before taking steps to end the experiment. An exit strategy based on specific goals would have saved a lot of unnecessary austerity-induced pain for the people of Kansas.

❝ Share information freely: We knew the Kansas experiment was going badly when the executive branch decided to stop reporting economic news about it…

Win or lose, take responsibility: Broad proof of the failure of Brownback’s tax cuts led the legislature to begin unraveling them. Rather than admitting defeat, Brownback vetoed its actions. His refusal to accept a verdict reflects a failure to recognize and take responsibility for his own policies.

❝ By just about every measure, Kansas’ economic laboratory experiment is now over, and the results are in. Supply-side tax cuts as executed in Kansas don’t generate more economic growth or create more jobs. They reduce tax revenue and forced the government to cut spending on essential goods and services like roads and schools.

RTFA for more detail. Unless you’re a Republican True Believer the cause-and-effect relationships are clear. Evidence is a bear. That the mass of Kansas voters went along with Brownback’s incompetence for so long speaks only to their obedience, lack of independence, loyalty to ideology in the face of daily evidence of failure.

Barry Ritholtz is one of my favorite writers on matters financial in the United States. That he has a fey sense of humor, refers to himself as a Recovering Republican, allegiance to evidence and facts over ideology is icing on the fiscal cake.

Congress blocked Attorney General from persecuting states with legal medical marijuana

❝ Attorney General Jeff Sessions is clearly fired up to fight state marijuana laws. Unfortunately for him, Congress just doused his chances.

The new 1,665-page spending bill maintains a provision that prevents the Department of Justice from using any of its funds to hamper state laws related to medical marijuana. The department cannot “prevent any of them from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana,”…

❝ The section that ties the hands of the Department of Justice on medical marijuana enforcement is not new. It has been around since 2015. But it received little fanfare amid the Obama Administration, which took a lenient stance on enforcing federal marijuana laws in states that legalized use…

…Sessions can still go after recreational use of marijuana in the eight states that have passed such laws. But without funding, Sessions has little ability to fight the medical marijuana laws in 29 states and the District of Columbia.

❝ Congress appears to be growing increasingly comfortable with states adopting their own marijuana policies. Unfortunately, spending prohibitions like these expire at the end of the fiscal year, so there is still a need for a long-term solution.

Another good reason to support independent-minded politicians of any identity. Yes, it’s important to fight and win battles to get for-real change into legislation. But, when we’re stuck with a swamp full of bought-and-paid-for right-wing pimps and ass-backwards 19th Century moralists – even getting the occasional beginner into office who doesn’t think progress is a dirty word is worth supporting.

“Why I’m Absolutely an Angry Black Woman”


Femi Matti

❝ Because when I was five, my kindergarten classmate told me I couldn’t be the princess in the game we were playing because black girls couldn’t be princesses. Because I was in third grade the first time a teacher seemed shocked at how “well-spoken” I was. Because in fourth grade I was told my crush didn’t like black girls.

❝ Because in sixth grade a different crush told me I was pretty  —  for a black girl. Because in 7th grade my predominantly black suburban neighborhood was nicknamed “Spring Ghettos” instead of calling it its name (Spring Meadows). Because I was in 8th grade the first time I was called an Oreo and told that I “wasn’t really black” like it was a compliment.

❝ Because in 9th grade when I switched schools a boy told me he knew I had to be mixed with something to be so pretty. Because in 10th grade my group of friends and I were called into an office and asked if we were a gang, or if we had father figures. Because in 11th grade my AP English teacher told me that I didn’t write like a college-bound student (though I later scored perfectly on the exam).

And so it goes in a Black American life. And Black lives in many other lands formed by white Imperial economics, greed. Please RTFA. Feel. Learn,

Thanks, UrsaRodinia

Advertise on Fox’s Bill O’Reilly Show? Sex Scandals everywhere? Runaway, runaway!


You wondered who set Trump’s standards

❝ Fox News is in a jam this week as major automakers and smaller outfits pull their ads from the network’s popular “O’Reilly Factor” show, following a series of sexual harassment claims against host Bill O’Reilly.

BMW, Mercedes-Benz, Lexus, Hyundai, and Mitsubishi all yanked their ads after a New York Times investigation that surfaced five sexual harassment cases against the political pundit.

They were joined Tuesday by pharmaceutical makers GlaxoSmithKline and Bayer, Sanofi Consumer Care, insurer Allstate, asset management firm T. Rowe Price, and personal finance company Credit Karma.

❝ Orkin, a pest control company, and Untuckit, a men’s clothing line, and Constant Contact, an email marketer, and Ainsworth Pet Nutrition, the parent company of the Rachel Ray-endorsed dog food brand Nutrish, also announced they were pulling ads.

In total, at least 15 advertisers have so far withdrawn support

❝ Mercedes-Benz said in an emailed statement that its advertising on the show “has been reassigned in the midst of this controversy.”

“The allegations are disturbing and, given the importance of women in every aspect of our business, we don’t feel this is a good environment in which to advertise our products right now,” added spokeswoman Donna Boland…

❝ The Times reported that the five women have received settlement payments totaling $13 million from either Fox or O’Reilly himself.

Couldn’t happen to a nicer guy…or a crappier network.

Feds Drop a Child Porn Case Rather Than Give Up a Hack


FBI Headquarters

❝ The Department of Justice filed a motion in Washington State federal court…to dismiss its indictment against a child porn site. It wasn’t for lack of evidence; it was because the FBI didn’t want to disclose details of a hacking tool to the defense as part of discovery. Evidence in United States v. Jay Michaud hinged at least in part on information federal investigators had gathered by exploiting a vulnerability in the Tor anonymity network.

In other words, the feds are letting an alleged child pornographer free so that officials can potentially catch other dark-web using criminals in the future…

❝ For years now, federal investigators have used hacking tools to undermine the Tor anonymity network and identify suspects attempting to conceal their identities and actions. These Tor exploits help federal law enforcement agencies investigate serious crimes, particularly child porn rings on the dark web, that would otherwise be difficult to prosecute. But the DOJ will apparently go to extreme lengths to protect the disclosure of those exploits, raising new questions about the boundaries of investigative hacking…

❝ All that’s certain is that the feds have dropped a case against an alleged child pornographer, with some unknowable trade-off down the road.

Actually a tough question for law enforcement. Beyond the boundaries of the usual prosecutor. Interesting to see where this leads. If anywhere.

Who’s happy, who’s not!

❝ If you want to go to your happy place, you need more than cash. A winter coat helps — and a sense of community.

A new report shows Norway is the happiest country on Earth, Americans are getting sadder, and it takes more than just money to be happy.

❝ Norway vaulted to the top slot in the World Happiness Report despite the plummeting price of oil, a key part of its economy. Income in the United States has gone up over the past decade, but happiness is declining.

The United States was 14th in the latest ranking, down from No. 13 last year, and over the years Americans steadily have been rating themselves less happy.

“It’s the human things that matter. If the riches make it harder to have frequent and trustworthy relationship between people, is it worth it?” asked John Helliwell, the lead author of the report and an economist at the University of British Columbia in Canada — ranked No. 7…

❝ Norway moved from No. 4 to the top spot in the report’s rankings, which combine economic, health and polling data compiled by economists that are averaged over three years from 2014 to 2016. Norway edged past previous champ Denmark, which fell to second. Iceland, Switzerland and Finland round out the top 5…

❝ Study co-author and economist Jeffrey Sachs of Columbia University said in a phone interview from Oslo that the sense of community, so strong in Norway, is deteriorating in the United States.

We’re becoming more and more mean spirited. And our government is becoming more and more corrupt. And inequality is rising,” Sachs said, citing research and analysis he conducted on America’s declining happiness for the report. “It’s a long-term trend and conditions are getting worse.”

Somehow, I don’t think folks betting on “Make America Great” know crap about what brings happiness to ordinary American families, working-class individuals.

Most powerful sheriff in the country now faces 20 years in prison

❝ Once the most powerful sheriff in the United States, Lee Baca is now headed to prison.

A jury convicted the former Los Angeles County sheriff Wednesday on conspiracy charges stemming from his role in a cover-up of extensive civil rights abuses inside the county’s vast jail system.

❝ The scope of Baca’s actual conviction is much narrower than the departmental scandal that eventually chased him out of office in 2014, as dozens of his officers faced criminal charges.

❝ Baca’s own convictions tie back to one specific incident within a much longer saga of abusive and corrupt practices in the county jail system. Human rights lawyers had documented allegations of brutality and corruption inside Baca’s jails for years before federal investigators got involved. When Baca’s team discovered the investigators had an inmate informant, they hid the inmate from the FBI agents who were working with him and sent two people to confront the lead investigator at her home.

❝ Baca’s role in crafting and approving efforts to stymie an investigation put him in a legal box. But that’s akin to catching Al Capone for cheating on his taxes, considering the years of detailed reports on the culture of extreme and routine violence deputies used to maintain their authority within Baca’s jails.

❝ Baca, now 74, had initially sought to avoid trial entirely, copping a plea on lesser charges in exchange for a six-month sentence. A judge decided that the sentence was too light and refused to approve the deal.

Which is why continued vigilance over judges, how they are elected and/or appointed is critical. One of the last defenses against corruption and crime in a nation that often rewards criminal behavior with elective office. Worshipping the strong man syndrome.

Baca now faces a maximum of 20 years in prison.

Claiming a social security number is the “Mark of the Beast” not a good defense – so saith the IRS

A Pennsylvania man has been convicted of failing to file his income tax returns for 21 years because he considered using a Social Security number akin to using the “mark of the beast” spelled out in the Bible.

James Schlosser, who lives in the town of Bird-in-Hand, was convicted in federal court in Allentown…

Prosecutors say by failing to file the returns from 1994 to 2014 he didn’t report $2.3 million in income he earned as a salesman of medical equipment. Prosecutors say he funneled the money through foreign business trusts and corporations he registered in Nevada.

An attorney for the 59-year-old Schlosser didn’t immediately comment…He’ll be sentenced June 10 when he faces a maximum of five years in prison and $450,000 in fines.

Wonder if he’ll ask Trump for a pardon?