Economic issues – Page 9

Has U.S. life expectancy peaked?

Life expectancy in the United States is at an all-time high. But like the stock market, it’s starting to look a little toppy. Life expectancy has started to decline in some parts of the United States, particularly rural areas and parts of the South.

According to LifeScience:

“Though the United States has by far the highest level of health care spending per capita in the world, we have one of the lowest life expectancies among developed nations — lower than Italy, Spain and Cuba and just a smidgeon ahead of Chile, Costa Rica and Slovenia, according to the United Nations. China does almost as well as we do. Japan tops the list at 83 years.”

This online medical journal has charts showing how life expectancy is changing area by area. (It’s uncanny how a county-by-county chart of life expectancy looks like a voting-patterns chart.)

This is all very sad, because life expectancy would continue to rise if people took advantage of what we now know about diseases caused by diet and lifestyle.

Since 1932…

On July 8, 1932, the Dow Jones Industrial Average hit its lowest point of the Great Depression — 41.22

The media, as far as I can tell, almost completely ignored yesterday this story from the Associated Press about federal tax receipts, which have dropped in 2009 at a rate not seen since 1932. For the first six months of the year, individual income tax receipts were down 22 percent from a year ago. Corporate income tax receipts were down 57 percent.

For the month of April, the biggest month for collecting taxes, individual income taxes were down 44 percent, and corporate taxes were down 64 percent.

I wish someone could explain to me how individual income taxes can be down 22 percent if the unemployment rate is 9.5 percent. I also would like to understand how the earnings news can be good on Wall Street if corporate income taxes are down 57 percent.

From Time magazine:

Time magazine has a lame piece today on why there is more obesity in the South than in the rest of the country. They’re right about some things, for example the correlation of health and weight to income. But they trot out all the old stereotypes about biscuits, fried chicken, and pie. Southerners have always been poor, but they have not always been fat, as an examination of any collection of old photos will show you.

As a Southerner, a foodie, and a person who takes careful note of what people have in their carts in the grocery store line, I claim the standing to comment knowledgeably on this question.

1. Southerners have stopped cooking from scratch. This is clear from the contents of their grocery carts.

2. Southerners have too little color in their diets. Pretty much everything in their grocery cart will be meat or something white.

3. Southerners consume astonishing quantities of canned and bottled sweet drinks. By weight, sweet drinks are probably the main items in their grocery carts. Few even seem to make fresh iced tea at home anymore.

4. Southerners eat too much meat. They seem to have cut way back on pinto beans, which, in my childhood, you were guaranteed to get at least twice a week.

5. Southerners eat too much cheap white bread and too many chips.

6. Southerners buy very few fresh foods, not even fresh potatoes. It took me a while to realize that people aren’t interested in starting gardens because they aren’t interested in what comes out of gardens.

7. When Southerners eat out, whether at fast food places or not, they eat even more calories than they eat at home. Restaurants compete on price and the size of the portions.

If Southerners could go back to the era of homemade biscuits, all would be well. People made biscuits because it was hard to get white bread, or the white bread cost more. Biscuits come from an era in which everything came from the kitchen, from scratch.

Michael Pollen’s rule of thumb is the best I’ve ever heard: It’s about remembering and honoring what our great-grandmothers cooked. Many Southerners seem to have forgotten.

Some perspective on California's budget

Those who like to bash California have been tsk-tsk’ing at California’s budget problems, trying to blame California’s “public sector.” California’s budget shortfall, at present, is estimated to be about $22 billion.

For comparison, the bailout of one bank alone — Citicorp — means that American taxpayers have now given $60 billion in direct assistance to Citicorp, plus $340 billion in guarantees. That comes to $400 billion, to one private bank! So far, the United States government has made about $12.7 trillion in guarantees and other financial commitments to private interests — Wall Street.

Another bit of perspective: During the California “energy crisis” of 2000 to 2001, Enron and other private interests ripped off Californians for between $30 billion and $70 billion, depending upon where one gets the numbers. Enron, by the way, paid no federal income taxes in most years and even used gimmicks to get tax rebates.

The reason California has a budget problem is that its revenue has fallen off a cliff because of the economic catastrophe brought to us by Wall Street. Last month, sales tax revenue in California was down 51% compared with last year, and personal income taxes were down 44% compared with last year. Californians are not making much money, and they aren’t spending much money.

If you look at the pie chart for California’s revenue, it’s pretty obvious which sector of the economy is not paying its fair share. California could easily fix its budget problem by increasing corporate taxes.

All the noise about public spending and the public sector is propaganda, distortion, and distraction. It’s unregulated greed and a corrupt Congress that we need to focus on.

A number we've been looking for: 2.3%

Corporations and their propagandists are always complaining, with great shrillness, that the United States has one of the highest tax rates in the developed world (35%). To which advocates for tax fairness always reply: Nominal tax rates are one thing, but actual taxes paid, because of loopholes and shelters, is something else again. To figure out just how much in taxes big corporations (and rich people) pay is very, very difficult. It’s one of the things that they very, very much don’t want working people to know.

Here’s a number in the Washington Post story on Obama’s plan to put an end to offshore tax havens:

“The tax havens allow major U.S. corporations to pay taxes on only a fraction of their profits. According to 2004 numbers, the most recent the administration has on hand, U.S. multinational corporations paid an effective tax rate of 2.3 percent on $700 billion in profits.”

What the boom did to Ireland

New York Times: Dingle town and Dingle harbor

The New York Times on-line edition has a little essay this morning on what the boom did to Ireland. It left the countryside littered with tacky little houses that no one wants. There is a hidden cost in that, because it cost Ireland, and least in many places, its old Irish look.

Whatever the next boom turns out to be, let’s hope it isn’t something that eats land and lays down pavement.

Dingle town, by the way, is fairly unchanged by the boom, as is the awesome stretch of road over Mount Brandon.

Obsessing about water

It goes without saying that sustainable living is not, um, sustainable without water. Farmers obsess about the weather, as well they should. Their livelihood depends upon the weather. Here in the Southeast, in the foothills of the Blue Ridge, we’ve been in a drought. There is no shortage of surface water at present. We’ve had around 2.5 inches of rain in the past few days. But groundwater, the aquifers that feed our wells and keep our springs and streams flowing, still has not recovered from the drought years early this decade.

The United States Geological Survey maintains wells around the country to monitor groundwater levels. The two nearest me are at East Bend, North Carolina; and Mocksville, North Carolina.

The chart above shows the groundwater level at Mocksville for the past seven days. The soaking rain we’ve had for the past few days is definitely bringing up the groundwater.

The chart above shows the groundwater level at East Bend for the past 60 days. That chart, too, looks good.

Nerd note: The daily data in the chart above shows a saw-tooth periodicity that made me curious. Some quick research suggests that barometric pressure causes fluctuation in the groundwater level. But solar and lunar tides also seem to affect groundwater levels.

But if you look at the long-term Mocksville data, which is available only as far back as 1981, you can see that, long term, groundwater level is still below the mean, and we are still in a drought with an unfavorable long-term trend.

Speaking of periodicity, the groundwater level here normally falls during the warm seasons of the year and rises during the cool seasons of the year.

Tax rates

There was quite an outburst at the prospect of raising taxes for incomes over $250,000 a year. That’s radical, many said. “We’re running out of rich people,” said Michele Bachmann. “How Obama Will Bleed the Rich Dry” is the headline on Michael Gerson’s column this morning in the Washington Post.

The key point of fact is this: the Obama budget raises the tax rate on income over $250,000 a year from 35 percent to 39.6 percent.

Historically, that’s hardly radical. The top rate was over 90 percent during the 1940s, 1950s, and 1960s, and 70 percent during the 1970s. We never ran out of rich people.

Historically, what’s radical was Reagan’s reducing the top tax rate to 28 percent in 1986. Though there were tax cuts on high incomes, wage earners actually paid higher taxes under Reagan. Part of this project of lower taxes for the rich and higher taxes for wage earners was to teach wage earners to hate government by convincing people that higher taxes always hurt the little guy. That is just not true.

Denmark

Wikipedia

Those who say that the United States is on a course toward European-type socialist democracies could be right. Let’s take a look at Denmark…

In the past eight years I’ve made two business trips to Denmark and spent four weeks there. I helped install a Danish publishing system at the San Francisco Chronicle, so I worked closely with a Danish company, and lots of Danes, for several years. This publishing system, by the way, is the system that’s also used at the New York Times and the Washington Post. The Danes are fantastic engineers and smart, honest businesspeople.

Most of these factoids about the Danish economy come from the Wikipedia article on Denmark:

— Denmark has a free market economy.

— Denmark has a large welfare state.

— Denmark has one of the world’s highest levels of income equality.

— Danes are very productive, and Denmark’s GDP per capita is 15 to 20 percent higher than the United States.

— Denmark holds the world record for income tax rates.

— All college education in Denmark is free.

— 80% of employees belong to unions.

— Denmark spends about 1.3 percent of GDP on defense, compared with about 4 percent in the United States.

— The national health service is financed by an 8 percent tax. This is a local tax on income and property.

— According to Statistics Denmark, the unemployment rate in Denmark in January 2009 was 2.3 percent.

— In some surveys, Denmark is ranked the happiest place on earth.

— Denmark was ranked the least corrupt country in the world in the Corruption Perception Index.

— According to the World Economic Forum, Denmark has one of the most competitive economies in the world.

I realize that Denmark’s model probably would not scale up in a workable way for the United States. Still, in my opinion, we should be studying some of the European models and not let ourselves be scared by them. They work.

So the New York Times confirms my guess…

New York Times: A Los Angeles neighborhood where the creative class wiped out

It looks like I beat the New York Times by two days on this trend. The Times has a story today about the retreat of the creative class:

The deep recession, with its lost jobs and falling home values nationwide, poses another kind of threat: to the character of neighborhoods settled by the young creative class, from the Lower East Side in Manhattan to Beacon Hill in Seattle. The tide of gentrification that transformed economically depressed enclaves is receding, leaving some communities high and dry.

I wrote earlier this week about my fear that, when times get hard in cities, the creative class will be the first to go.

Let’s keep in mind, though, that the energy of the young and creative will always go somewhere. It is irrepressible. In the 1970s it took on a rebellious tone and went into place such as communes, or ghettoes such as Haight-Ashbury. During the decline of Rome it took on a more reclusive tone and went to abbeys and monasteries. We will soon start to learn what the creative class will do during this downturn. Will it be rebellious? Reclusive? Nerdy? Super-green? The response of the creative class will be a key factor in setting the tone of American culture for the coming era. If the response is constructive and creative, that could be a wonderful thing. If the response is angry and rebellious, watch out.