Category: Politics

10% of Voting Age Americans Not Registered to Vote

What’s Wrong Today:

In early June, Pew Research published a study called Political Polarization in the American Public. It reported that Republicans and Democrats are more divided along ideological lines than at any point in the past two decades. They surveyed 10,000 adults nationwide and the headline result was that these divisions are greatest among those who are the most engaged and active in the political process. The political center is shrinking while those at the left and right limits are growing. Here is a graph from the report:

PEW Ideological Divide

Now, Pew gives us more reason to be concerned about the future of our politics. The latest Pew Research Center’s political typology report was published on June 28. It sorted voters into 8 cohesive groups based on their attitudes and values, providing us with a political field guide for the elections in November. One of the groups is called “Bystanders”. They are 10% of the voting-age population. Despite all of the movement we see above among other groups, Bystanders were also 10% of voting-age population in 2011. They are one group that will pay little, if any attention, to America’s midterm elections this November. From Pew Research: (emphasis by the Wrongologist)

Overall, 10% of Americans are what we call Bystanders, or the politically disengaged…None of this cohort say they’re registered to vote, and none say they follow government and public affairs most of the time (this compares with 48% of Americans overall). Virtually all of this group (96%) say they’ve never contributed money to a candidate running for public office

Bystanders are young: 38% are under 30, compared to 22% of the general public; 67% have a high school education (or less), vs. 40% of the general public. Nearly a third (32%) are Hispanic and 29% are not citizens.

Although Bystanders view the Democratic Party more favorably than the GOP, they have a mix of liberal and conservative attitudes. They are sympathetic to the plight of the poor, but as many say that government aid to the poor does more harm than good as vice versa. They express fairly liberal views on homosexuality and same-sex marriage, but 54% say abortion should be illegal in all or most cases.

Asked about their interest in a number of topics,
• 73% of Bystanders say they have no interest in government and politics
• 66% say they are not interested in business and finance
• 66% think of themselves as an “outdoor person”
• 64% of Bystanders are interested in celebrities and entertainment (vs. 46% of the public)
• 35% call themselves a “video or computer gamer” (vs. 21% of the public)

Every aspect of our demography is being fundamentally transformed. Huge gaps have opened up in our political and social values, our economic well-being, our family structure, our racial and ethnic identity, our gender norms, our religious affiliation, and our use of technology. Are these people our future?

In the Pew survey, Bystanders were more likely than other political cohorts to answer “don’t know,” more likely to say they’ve “never heard of” the topic in question or to refuse to answer questions altogether.

So, taking away the 29% of Bystanders who aren’t US citizens and can’t vote, there are 71% of 10% of voting age Americans − some 7.1% of eligible voters − who could vote if they wanted to register. Or if they can register, since several states have added voter suppression laws since the Supreme Court decision in Shelby County vs. Holder last year.

What would it take to get them to pay attention politically? The 38% of the Bystanders who are Millennials are most likely to have common cause with the Democrats. If even half of them were convinced to register and were to vote blue in 2014 that would be a 2% boost for the Dems.

It might go a long way towards keeping the Senate with the Democrats in November.

Our last 4 presidential elections were based on negative messaging, by Republicans against Obama and by Democrats against GW Bush. We will not end the political polarization or bring the Bystanders into active citizenship until each party offers a positive vision with realistic programs backing it up.

We have to rebalance the social compact to better bind our young and old. Otherwise we will lose these young, less educated Americans who are more interested in celebrities than in the constitution.

In tomorrow’s world, yesterday’s math will not add up.

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Republicans Want To Repeal Obscure Tax Law

Reuters reported last week that the Republican National Committee (RNC) approved a resolution that adds the repeal of an Obama administration law to its 2014 platform. The law is designed to crack down on offshore tax dodging.

The legislation that the Republicans are targeting is called the Foreign Account Tax Compliance Act (FATCA). What is FATCA? According to Wikipedia, FATCA requires US citizens, including individuals who live outside the US, to report their financial accounts held outside of the US, and requires foreign financial institutions to report to the IRS about their American clients.

Although FATCA was passed by Congress in 2010, it will go into effect on July 1, 2014. It requires foreign banks and investment funds to report to the IRS all assets they hold that exceed $50,000 belonging to US citizens – whether those citizens are living in America or abroad.

The genesis of the law was a 2010 tax-avoidance scandal involving a Swiss bank. One result of FACTA was that last August, Switzerland signed a separate treaty with the US, ending a longstanding tax dispute between the two countries, that gave the IRS unprecedented access to
Swiss accounts held by Americans and US green card holders.

Banks in most tax havens are planning to abide by the new rules because of hefty fines (the IRS can withhold 30% of dividends and interest payments due to the banks from US accounts) since failure to comply with these regulations could seriously impact banks’ ability to do business in America. A successful indictment could bar the bank from the US marketplace. Because of that threat, FATCA is driving a rapid expansion of a network of bilateral, tax-related information-sharing agreements, negotiated by the US Treasury and its overseas counterparts amid heightened global concern about tax dodging.

So, do Republicans want to allow rich individuals and wealthy companies to continue to hold money in off-shore banks without subjecting these monies to federal taxes? Apparently,
and they also want to attract votes and funding from Americans living abroad. The US expatriate community is violently opposed to the law, and some have legitimate concerns about losing
their banking relationships in the foreign country where they live. Their banks are concerned that the costs of flagging the accounts of Americans and maintaining separate reporting formats for them may too high for the less-than-$50k accounts that the US is not interested in. In 2013, nearly 2,400 expatriates gave up their US citizenship or turned in their green cards, some at
least, in an effort to avoid US taxation.

Reuters quotes Solomon Yue, an RNC official from Oregon:

I see FATCA just like Obamacare…It will attract American overseas donors

So, Republicans are eager to use FATCA as a campaign and fundraising issue against the Democrats in the Congressional mid-term elections in November. Repeal seems unlikely, but another issue that raises the political temperature could help defeat Democrats.

The RNC has set up a petition site at MoveOn.org that has about 2200 signers, quite a few from overseas. They have also set up a Repeal FATCA site. Here is a quote from the disinformation available there:

All this supposedly is justified by FATCA’s claim to “recover” lost taxes of less than $1 billion per year – enough to run the government for about two hours. (In fact, the way the U.S. Treasury plans to enforce FATCA, it would probably lose more money than it would take in!)

The Republicans seem to be saying that we don’t need $1 billion if it causes increased tax payments. Politically, it seems strange that this issue should become a hot issue for the Republicans, who are taking a beating in the polls over their stand on income inequality.

On the other hand, US wealthy individuals (Mitt Romney) and corporations that are able to use tax havens and have been able to hide behind account secrecy, would be very happy to see Mr. Boehner take up a bill to repeal FATCA. Foreign banks, many of which contribute to US political campaigns would also like to see the bill repealed

No one is asking the rich to pay unfairly – they already get all kinds of tax breaks − but
to encourage tax evasion seems to be far beyond the Republican’s usual pale.

How about having the rich simply pay their fair share and watch the federal deficit which they
are so concerned about, fall, without requiring Americans to give up food stamp subsidies or funding for long term unemployment benefits? So next time you hear Republicans talking about cutting the deficit, ask them why they are for tax evasion as opposed to tax compliance.

Hopefully, someone will ask Mr. Boehner why repealing a law that will promote the harboring of hidden money and continued tax avoidance is in our best interest. We know it is a key loophole for Mr. Romney. So Mr. Speaker, please tell us again why repealing laws is more important that strengthening them? They were passed for a reason. Maybe you should start pushing for our laws and regulations to be followed, rather than repealed.

Many other countries are striving for better education, better healthcare, a more engaged attitude about our planet and environment, a willingness to regulate guns and business with an eye toward the best interests of the people.

Thanks to US conservatives, we’ve headed in almost the opposite direction.

For Republicans, as long as rich people don’t pay more, undermining our country is okay. There’s just no restraining Republicans if the restraint we need involves the rich. And if responsible politicians try, the conservatives cry, “government overreach” or “socialism.”

But that’s just a red herring, an excuse so that they can continue to pillage America
for all they can get.

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Friday Musical Break

TGIF. We head into the weekend with music. Except today, when the musician, the late Ritchie Havens, delivers the spoken word at a favorite Georgetown undergrad hang for the Wrongologist, The Cellar Door.

If you ever saw him live, Ritchie Havens was a force of nature. This is from the Wrongologist’s eulogy:

Havens took his teeth out to sing. Apparently he cared more about how he sounded than how he looked. If you have that much talent, you don’t need teeth. He just sat there with his guitar and sang his songs. He didn’t have a persona, he had no guile.

Havens was also political. Often at concerts, he told the story of being an avid
follower of comic book superheroes, especially, Superman, who fought for
“Truth, Justice, and the American Way.” Here he is explaining just how incongruous the concept (was) is:

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It’s Just A Suggestion, But…

Would Gun Insurance Help?

Not insurance that pays to replace stolen firearms, but liability insurance for the damage that is done by firearms. Over the past few days, there have been many suggestions about mandating such insurance as a way of:

  • Paying for the damages done by people irresponsibly using (storing, playing with, or loaning) their guns
  • Reducing gun ownership by increasing the costs associated with it

Can we agree that guns as weapons are inherently dangerous to society? Can we agree that gun owners should bear the risk and true social costs of gun ownership?

Suggestion: Require both owners and sellers to purchase liability
insurance that is underwritten by private insurance companies according to the relative risk of the gun or the buyer. As John Wasik writes in Forbes:

When you buy a car, your insurer underwrites the risk according to your age, driving/arrest/ticket record, type of car, amount of use and other factors. A teenage driver behind the wheel of a Porsche is going to pay a lot more than a 50-year-old house wife. A driver with DUI convictions may not get insurance at all. Like vehicles, you should be required to have a policy before you even applied for a gun permit. Every seller would have to follow this rule before making a transaction.

This is where we take social economics beyond theory. Actuaries would work to understand which buyers/guns are most at risk to commit a gun crime, or to be used in a gun crime. Gun owners/buyers would then be underwritten according to age, mental health and place of residence, credit/bankruptcy record and/or marital status, whatever causal criteria turn out to be the most relevant.

Insurance companies have mountains of data and know how to use it to price policies, or in industry parlance, to reduce the risk/loss ratio. Wasik continues:

Who pays the least for gun insurance would be least likely to commit a crime with it. An 80-year-old married woman in Fort Lauderdale would get a great rate. A 20-year-old in inner-city Chicago wouldn’t be able to afford it. A 32-year-old man with a record of drunk driving and domestic violence would have a similar problem.

Moreover, the market would over time, become very efficient at weighing these risks, since insurers specialize in figuring out the odds of something going wrong and charging the appropriate amount for the risk.

And there’s a good argument that the damage caused by firearms gives the government a “compelling interest” to require insurance, the basic test for infringing the constitutional rights of our 2nd Amendment lovers.

If it seems like requiring insurance might be too expensive, remember that the social cost is already expensive: We pay a huge cost for firearms injuries, says the National Center for Biotechnology Information, a part of NIH. According to their study, most injuries are paid for with public funds. Mandatory insurance would shift that cost from a public tax burden to a private insurance burden borne by gunowners. Quoting from the conclusion of the referenced study:

96 % of the patients in this report had their costs of care covered by the government, because they had no primary insurance coverage.

There could be a possibility of lower taxes down the road, if medical costs paid by the government come down; the taxes needed to pay those medical costs could come down too.

Given that gun violence kills more than 30,000 Americans annually, it is harmful not only to our well being, but our economy, so using economic disincentives to moderate their use makes sense.

If you think that the idea of mandatory insurance is onerous, think again:

You can’t finance a home mortgage without homeowner’s and title insurance. If you haven’t got title insurance and are interested in getting some advice about it, you could contact an insurer like Bay Title Company for example to see what help they could give you. Insurance is needed for just about anything. Want to own a car? Most states require liability insurance. You can’t employ someone in most states without worker’s compensation or unemployment insurance.

The advantages of mandatory gun insurance include the following:

  • Responsibility is placed on the gun owner: The law would require firearm owners to take responsibility for their firearms. Insurance separates responsible firearm owners from irresponsible ones
  • Control remains in the private sector: Private firms will vet the buyer for proper acquisition of firearms, not the Government
  • 2nd Amendment rights are protected: Anyone can purchase firearms as long as they can get insured
  • Promotes registering of existing weapons: Unregistered weapons will not be insured so the owners will not be able to buy ammo for those guns
  • Those who are injured: Will receive some recompense for their injury

What about the economic burden on gun owners?

If the insurance is required by the gun, the cost may prevent some people from buying them. A buyer in the middle class or higher could easily afford insurance on multiple weapons. If insurance was required for each gun registered, it might discourage multiple purchases by high risk owners. It may make people more responsible when they store their guns: Stolen guns had better be from a broken-into gun safe or your policy renewal will be a lot more expensive; the same would probably happen to your rates if little Billy finds a loaded gun in the desk drawer and shoots his friend with it.

It probably means that poorer people won’t be able to afford the insurance, so it probably will not dramatically affect gun violence (or coverage for same) in inner cities. We know that people take the chance of driving without insurance all the time and it’s a lot easier for someone to hide an uninsured gun than to drive an uninsured automobile.

But, will it work?

Insurers underwrite risk: casualty loss, liability, health, auto, home and life insurance. If you’re looking into life insurance you’ll want to make sure you research as much as possible or get expert advice so you know the policy you’re going with is the best suited one for you. For those of you in Canada, the most trusted comparison site is arguably PolicyMe.com so that might be the place to start. For American citizens, there are similar comparison sites that you could use. I always think these are the best way to view prices. One thing to remember is that Affordable Life USA offers great Mortage Life Insurance. Just make sure you do your research before accepting the first quote. With gun insurance, instead of charging the highest premiums for overweight smokers, alcoholics with bad driving records and dangerous hobbies, the most expensive gun policies will be priced for those who are younger with histories of mental illness, divorce, criminal records or severe financial difficulties. Or, the highest prices will be for the kinds of weapons that kill the most people the quickest: A shotgun owner who has hunted for years without incident would pay far less than a first-time owner purchasing a semi-automatic.

People would have a financial disincentive to purchase the most risky firearms. They would have a financial incentive to attend gun safety classes and use trigger locks. Using insurance to drive outcomes instead of attempting to enforce widespread bans and confiscation may result in much of the behavior we seek, without another festering, divisive issue draining our society.

Requiring insurance will simply add the already known social costs to the actual manufacturing costs of a weapon. If the social costs go higher, price of owning a weapon will be higher; if the social costs go down, so will insurance costs.

The market will decide what the fair price will be.

Insurance can be used to effectively price the risk and costs of social harm. This idea falls short of immediately getting rid of the most dangerous weapons and it will not prevent the next Newtown, but we have to start somewhere.

The Constitution was ratified in 1789. We are the Founders now. These are our problems and we must come up with our own solutions. The 2nd Amendment does not fit perfectly with current circumstances. Gun ownership has become a bigger problem than any of the problems it was meant to solve. The British are NOT coming; Indians no longer threaten your little fort.

Buy insurance for each gun, or turn the gun in.

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