Category Archives: Politics

The large percentage of Americans who use software or pay someone to do their taxes

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Here is a statistic that gives us some idea about how difficult the American public thinks filling out their yearly taxes is:

More than 80% of individuals hire someone or buy software to help file their taxes, though only 64% of filers owe them, according to the Tax Foundation. So millions of filers pay for help to learn that their tax liability is zero.

I recently finished doing these by hand and while it wasn’t terrible, it was time consuming. While the article suggests both individuals and companies spend a lot of time and pay a lot in order to have their taxes done, it sounds like the tax preparers and software companies have plenty of business…

Politicizing copyright use

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Various outlets are reporting that former Florida Governor Charlie Crist issued a YouTube apology to Talking Heads’ singer David Byrne for using the song “Road to Nowhere” without permission as part of Crist’s 2008 senatorial campaign.  Quoting from the ABA Journal:

In a written statement [dated 11 April 2011], Byrne said he had been surprised to learn that such unauthorized use of a song isn’t all that unusual, and said that he was "feeling very manly" about having protested rather than simply let the issue go.

"Other artists may actually have the anger but not want to take the time and risk the legal bills. I am lucky that I can do that," he stated. "Anyway, my hope is that by standing up to this practice maybe it can be made to be a less common option, or better yet an option that is never taken in the future." [emphasis added]

Such explicitly political use of artists’ music certainly has a long history.  Just a few weeks ago, the ABA Journal published an article by L.J. Jackson titled “Musicians Chafe at Politicians’ Misappropriations of Their Work” which demonstrates that

Crist’s legal problems are not unique.

In 1984, Bruce Springsteen made headlines when he objected to President Ronald Reagan’s use of his hit "Born in the U.S.A." as an anthem for his re-election campaign. The rock icon accused Reagan of subverting the true meaning of the song and playing it at rallies without his consent.

Those were the good old days, when an artist’s biggest campaign concern was a candidate using their tunes to pump up the crowd (permitted with a blanket performance license). But times, they are a-changing, and the proliferation of viral videos, YouTube, and Facebook has opened a Pandora’s box of copyright problems for politicians seeking pop-culture cred. [emphasis added]

Jackson doesn’t elaborate on the “blanket performance license” point, but it’s a major one that bears unpacking.  If a politician has the relevant blanket performance licenses from the relevant performance rights organizations (PROs), (s)he is allowed to play recording artists’ music at campaign rallies.  It doesn’t matter if the artist dislikes that particular politician any more than if (s)he dislikes a particular local radio DJ:  the politician (and the DJ) still have permission to play.

I think there are solid policy justifications for allowing such blanket licenses (and thus largely foreclosing artists’ ability to object to particular uses).  Aside from the enormous transaction costs that would be involved with case-by-case negotiation and approval, music clearly lies at the center of mainstream American culture.  Given music’s powerful emotional resonances which often extend well beyond the intent and control of the original artists, allowing artists to withhold public performance of their recorded music by particular non-profits, schools, businesses, or political campaigns seems perverse at best.  In extreme cases, such denials may even be tantamount to private censorship.

Whether you agree with my policy justifications or not, however, the fact remains that blanket performance licenses for live events already exist.  Thus, the question really is this:  why is the Internet any different?  What makes “viral videos, YouTube, and Facebook…a Pandora’s box of copyright problems” where none exist in the physical world of live campaign rallies, sporting events, or trade shows?

I submit that there really is no difference.  The same transaction cost and First Amendment justifications for blanket performance licenses apply with equal weight to Internet media.  To me, any policy difference appears to be simply a historical artifact.

A blogger at Clancco asks:

I wonder what the “free culture” lobbyists have to say about fair use, free culture, and the world is our public domain oyster when it comes to a Republican politician using an artist’s song without the artists permission? We certainly know what Byrne thinks…and it’s not good for Republicans.

I don’t know what “the ‘free culture’ lobbyists” would say, but my response is this:  the political affiliation of the music’s user should not matter one iota.  We can certainly have a policy debate, but that doesn’t mean the debate must (or should) be political.

Pew using word frequencies to describe public’s opinion of budget negotiations

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In the wake of the standoff over a federal government shutdown last week, Pew conducted a poll of Americans regarding their opinions on this event. One of the key pieces of data that Pew is reporting is a one-word opinion of the proceedings:

The public has an overwhelmingly negative reaction to the budget negotiations that narrowly avoided a government shutdown. A weekend survey by the Pew Research Center for the People & the Press and the Washington Post finds that “ridiculous” is the word used most frequently to describe the budget negotiations [29 respondents], followed by “disgusting,” [22 respondents] “frustrating,” [14 respondents] “messy,” [14 respondents] “disappointing” [13 respondents] and “stupid.” [13 respondents]

Overall, 69% of respondents use negative terms to describe the budget talks, while just 3% use positive words; 16% use neutral words to characterize their impressions of the negotiations. Large majorities of independents (74%), Democrats (69%) and Republicans (65%) offer negative terms to describe the negotiations.

The full survey was conducted April 7-10 among 1,004 adults; people were asked their impressions of the budget talks in interviews conducted April 9-10, following the April 8 agreement that averted a government shutdown.

I would be hesitant about leading off an article or headline (“Budget Negotiations in a Word – “Ridiculous”) with these word frequencies since they generally were used by few respondents: the most common response, “ridiculous,” was only given by 2.9% of the survey respondents (based on the figures here of 1,004 total respondents). I think the better figures to use would be the broader ones about negative responses where 69% used negative terms and a majority of all political stripes used a negative descriptor.

You also have to dig into the complete report for some more information. Here is the exact wording of the question:

PEW.2A If you had to use one single word to describe your impression of the budget negotiations in Washington, what would that one word be? [IF “DON’T KNOW” PROBE ONCE: It can be anything, just the first word that comes to mind…] [OPEN END: ENTER VERBATIM RESPONSE]

Additionally, the full report says that this descriptor question was only asked of 427 respondents on April 9-10 (so my above percentage should be altered: it should be 29/427 = 6.8%). So this is a smaller sample answering this particular question; how generalizable are the results? And the most common response to this question is the other category with 202 respondents. Presumably, the “others” are mostly negative since we are told 69% use negative terms. (As a side note, why not separate out the “don’t knows” and “refused”? There are 45 people in this category but these seem like different answers.)

One additional thought I have: at least this wasn’t put into a word cloud in order to display the data.

Two steps for lower taxes

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With taxes due in less than a week, Derek Thompson over at The Atlantic has some solid advice for “beating the Tax Man at his own game”:

First, be self-employed. Second, be very rich.

Among other reasons that the article notes, “money buys access to the smartest accountants and tax attorneys, who have scoured the labyrinthine tax code for the best nooks and crannies to shelter income.”

It may not be the most efficient allocation of overall resources, but it sure does offer a compelling individual ROI.

Going rogue

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Wired’s Nate Anderson has a great write-up over at Ars Technica of the “Legitimate Sites v. Parasites” hearing before the U.S. House of Representatives Judiciary Committee today, and it’s not looking good for Internet intermediaries:

[T]he general mood of the hearing was that tough new steps must be taken. As Rep. Darrell Issa (R-CA) asked [Immigration and Customs Enforcement director John] Morton during his questioning, “What change in the law would allow you to pursue everyone?”

In his written testimony before the committee (PDF), Kent Walker, Google’s Senior VP and General Counsel noted that such an all-inclusive approach would be impossible and counterproductive:

When it comes to offshore rogue sites, no one should think that imposing additional obligations on search engines, social networks, directories, or bloggers beyond the DMCA [Digital Millennium Copyright Act] will be a panacea. If the site remains on the web, neither search engines nor social networks nor the numerous other intermediaries through which users post links can prevent Internet users from talking about, linking to, or referencing the existence of the site. These links or references will themselves appear in search results, and will enable users to reach the site. Simply put, search engines are not in a position to censor the entire Internet, deleting every mention of the existence of a site. If a rogue site remains accessible on the Internet, relying on search engines to try to make it “unfindable” is an impossible endeavor. [emphasis added]

I recommend reading Walker’s full comments for a robust defense of why the notice-and-takedown immunity provided by the DMCA is essential for innovation.

Additional coverage by Politico, Techdirt, CNET, TorrentFreak, RIAA Blog…

Data on the growing conservatism of the American public

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A number of commentators have explored recent data from Gallup regarding America’s increasing conservatism. Richard Florida takes a stab at the data here. Here are Florida’s conclusions:

Conservatism, at least at the state level, appears to be growing stronger. Ironically, this trend is most pronounced in America’s least well-off, least educated, most blue collar, most economically hard-hit states. Conservatism, more and more, is the ideology of the economically left behind.  The current economic crisis only appears to have deepened conservatism’s hold on America’s states. This trend stands in sharp contrast to the Great Depression, when America embraced FDR and the New Deal.

Liberalism, which is stronger in richer, better-educated, more-diverse, and, especially, more prosperous places, is shrinking across the board and has fallen behind conservatism even in its biggest strongholds. This obviously poses big challenges for liberals, the Obama administration, and the Democratic Party moving forward.

But the much bigger, long-term danger is economic rather than political. This ideological state of affairs advantages the policy preferences of poorer, less innovative states over wealthier, more innovative, and productive ones. American politics is increasingly disconnected from its economic engine.  And this deepening political divide has become perhaps the biggest bottleneck on the road to long-run prosperity.

Interesting thoughts. A few questions about this:

1. Is this a long-term trend or a relatively recent development that could be reversed relatively quickly?

2. How might these demographics tied to each party interact with the public image of the parties that suggests Republicans are about the wealthy and Democrats are on the side of the working class?

3. Does this suggest that the economic engines of America are primarily in Democratic areas (which I assume Florida would see as being located in central cities and the surrounding areas)? Is this the case because of particular Democratic policies or is this the result of other factors?

4. What would an analysis beyond correlations reveal? How do these different factors interact?

The possible shifts in the foundations of tax bases

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Governments are dependent on tax bases for revenue. Hopefully, the tax base meets financial expectations and if things are going well, the taxes bring increased revenues, leading to more spending (and saving?) possibilities. But what happens when tax bases decrease?

This is an issue facing a number of government bodies and a number of taxes are affected:

-I was reminded of this again by this piece (h/t Instapundit) which suggests that increasing income taxes on the rich may not work out in the long run as economic troubles can greatly affect the incomes of the rich.

-Property taxes are affected by the assessed value of properties. If property values are down, such as in this economic crisis where it appears housing prices will be depressed for quite a while, then tax revenue may go down. (Or they may not – can local communities really afford to have less money coming in through property taxes?)

-So called “vice taxes,” on things like cigarettes, may be self-defeating: as people smoke less, the revenue will slowly dry up.

-The gas tax will be interesting to watch in future years: as the government pushes for more electric vehicles and with higher gas prices, this could mean that less gasoline is purchased. Money to pay for new roads and maintenance will have to come from somewhere.

A couple of questions about these different taxes:

1. Is the uncertainty about tax revenues in the last few years really that different from other points in history? If not, what have people done in the past?

2. Might we expect to see some major changes in taxation in the coming years as governments look for different (perhaps more stable?) or more sources of revenue?

3. How are sales taxes or VATs affected by economic crises?

(The realm of taxes is not my area of expertise but I do know the importance of some of this to communities: limited or decreasing property and sales taxes lead to big issues with budgets which then affect services which then angers residents.)

A few comments by Joel (3/31/2011):

One way that cities and states are seeking to increase collection revenues is through enhanced sales tax enforcement.  As Amazon is finding out, for example, governments have their ways of pressuring online retailers.

Of course, to a certain extent, this is simply turning into an arms race, with businesses increasing their lobbying budgets and hiring more tax attorneys.

New York City to challenge 2010 Census figures

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While 2010 Census figures have shown population drops in places like Chicago and St. Louis, New York City gained population in the 2000s. However, some think the Census undercounted the population growth:

Apoplectic city leaders Thursday scrambled for words to convey their shock after Census numbers seemed to lowball Gotham’s population growth since 2000.

The figures show the city grew only 2.1 percent, to 8,175,133. Mayor Michael Bloomberg contended that a 0.1% increase — a mere 1,343 people — of Queens residents and a wee 1.6 percent rise in Brooklynites “doesn’t make any sense.” The city will challenge the findings, though some observers suggested a surge in harder-to-count recent immigrants and mobile, elusive young people could in part explain a possible undercount…

Joe Salvo, NYC’s chief demographer, expressed disbelief that just 166,855 more people were added to the city, when city data showed that 170,000 new housing units had been built since 2000.

The Census Bureau will be accepting challenges starting in June. New York City last appealed its count in 1990…

The Census Bureau agrees. “The pattern in New York City is like that seen in many other large cities – higher rates of growth in suburbs than in urban cores,” the Bureau said in a statement.

Just because more housing units were built during the 2000s doesn’t not necessarily mean that the population should have gone up more. I wonder if these NYC officials have more data or evidence on which they would base their claim.

The article also notes the consequences of these figures. On one hand, federal money and Congressional seats depend on population counts. Particularly in a time of economic crisis, losing money because of an undercount would mean that the city will have to fill some financial gaps. On the other hand, there is the matter of “civic pride.” A sociologist describes this dynamic:

Unacknowledged is that modest growth injured the “pride of place” in an immodest metropolis that likes to be perceived as ever increasingly majestic and magnetic, said John Logan, a Brown University sociology professor. As Chicago winced when it fell from the nation’s second largest city to third, NY is similarly loathe to lose any ground on growth. “Some see the numbers as a sign of how good you are,” said Logan, “but that’s a mistake.”

Measuring the status of a community just by numbers is tricky, particularly when the numbers are not as strong as one would like. But American communities like to see growth – losing population (or perhaps even being stagnant) is often construed as a failure.

Even with this (undercounted?) population growth, New York City still has a sizable population lead on the next largest city: NYC has more than 4 million more people than Chicago.

McMansions are Republican homes?

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In a humor/satire column in the Huffington Post, McMansions are tied to Republicans:

A Pew survey finds President Obama is polling quite well against a “generic” Republican opponent, better than George W. Bush was against a “generic” Democrat in 2003. Forty-seven percent of respondents said they would like to see Obama reelected while 37 percent opted for a generic Republican candidate. HuffPost Hill couldn’t reach “generic” Republican, Pleated Q. Pants IV, at his McMansion in suburban Columbus for comment. We hear he was shopping at a big box store and thinking about national security.

This is an interesting mix of characteristics: the “generic” Republican candidate shops at a big box store (why not say Wal-Mart? Is Target too trendy?) in central Ohio and lives in a suburban McMansion. There may be some truth to some of this: Joel Kotkin argued after the 2010 election that Republicans won the suburban vote even as both parties for fighting for this demographic.

I have seen other cases where McMansions are tied to Republicans. What exactly about the McMansion is Republican: the size? The bad architecture? The sprawl? The suburban lifestyle? The three (or more) car garage? The big mortgage? The wealth that made the house purchase possible?

What would a Democratic characterization in the same vein look like? In terms of the housing unit, how about an urban loft or a refurbished rowhouse or brownstone, all in a gentrified, atmospheric, and trendy neighborhood?

Internet competition

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My friend Adam Holland pointed me over to Galen Gruman’s article at InfoWorld, which points to the problems that arise when carriers have considerable pricing power:

Users are being forced to sign up for separate data plans for each device. The cellular carriers advertise their data plans in data buckets, such as $25 for 2GB of iPad usage at AT&T and $20 for 1GB of iPad usage at Verizon Wireless. But you also pay separately for access on your iPhone or other smartphone. That means multiple-device users are asked to pay a lot more, forcing most to make a choice between the two.In both cases, the pricing is illogical and punitive. For their DSL and TV services, neither AT&T nor Verizon (half-owner of Verizon Wireless) charges per computer or per TV, but that’s what they’re doing for mobile devices.

Of course, I’m sure that both AT&T and Verizon would love to charge per computer/TV for home Internet use as well (and AT&T is currently in the process of instituting data caps on home users).  As with so many mobile and broadband ISP policy issues, the fundamental problem is that many ISP operate as monopolies or oligopolies.  Accordingly, there are only two major impediments to their pricing structure:

  1. Government regulation
  2. More competition

Government regulation is, of course, is notoriously tricky.  Indeed, it is often counter-productive as established ISPs use vast lobbying budgets in an attempt to regulate any new competitors out of existence.

But more competition is great when it’s possible, and, fortunately, sometimes new market entrants do appear with offerings that put pressure on established providers.  To use a personal example, my wife and I use a Clear Spot for our only Internet service here in the Boston area.  It’s not perfect (ping times are high), but it’s only about $50/month and is fast enough for high quality Netflix streaming.  Moreover, the Spot’s 4G interface/Wi-Fi router allows us to use the Internet within our apartment or anywhere within Clear’s 4G network.  Among other things, this means we can use an iPod Touch “on the go” (just like an iPhone) and “tether” both of our laptops (no additional fee) and connect up to five more Wi-Fi devices (eight total).

Best of all, because Clear’s service is wireless, we don’t have to subscribe to Comcast even though they are the only ISP providing service to our building.  Maybe that’s why they sent us a letter this past week offering cable+Internet for less than $60 a month indefinitely (not as a temporary promotional price).  I guess the market really does work when the market really does work.