Saturday, January 25, 2014

Contraception and User Fees

It seems that some folks are miffed over Mike Huckabee’s recent comments on taxpayer funded contraception.  State funded birth control is an outstanding example of how the contributions of the many are used to fund the welfare of a select few.



In many such cases libertarians have advocated for user fees – where those who benefit directly pay for services received.  Such is the case is with toll roads, toll bridges and tunnel fees.  Those who traverse these arteries offset the cost of building and maintenance.  This is also the rationale for gasoline taxes at the pump, that is, to fund road upkeep.  If you are buying gas, you must be driving on publicly maintained roads.  Therefore you indirectly pay for this privilege via gas taxes.

This funding method applies neatly to contraception.

The first and most obvious beneficiary of contraception is the woman herself.  It would seem only fair for her to have skin in the game.  In the event that this particular lady is not heterosexually active she would be sole beneficiary and the burden of cost would fall directly on her.  This would also appear to be a waste or misallocation of pharmaceutical resources for which she should bear sole responsibility.

However, should said woman take on a male lover, we would now have two people sharing the utility of child free relations.  In that case it would be inequitable for the woman to bear the cost alone.  It would be only fair for the man to share the cost burden with her.  For argument’s sake, let’s say half.

The question now becomes, how would a progressive government enforce this cost sharing?  Let me offer a simple proposal.

At her request, each and every woman who is seeking contraception assistance would receive thirteen Partner Identification Forms (PIFs) from the IRS – one form for each ovulatory and pharmacological cycle.  Prior to commencing upon relations with her partner in any given 4-week cycle, the woman will require the man to attest that he did receive conjugal utility from her during that period and to provide standard taxpayer ID information – name, address, DOB and SSN.

At the end of the tax year, the participating woman would simply turn in her PIDs along with her tax return form to be reimbursed for half of her contraceptive cost during each of those periods in which she had documented relations.  She would receive a full tax credit which would be fully offset by corresponding surcharges to the lucky guy.

You may ask, what if she has multiple men in any given period?  Does the first man in have to pay the full freight while the trailing lovers become free riders?  Absolutely not!  This is where economic incentives and economies of scale kick in.

Should a second partner enter the picture within a given four week cycle, the woman would simply collect his information as she did the first.  Then, for that period, the contraceptive cost would be evenly split three ways.  The same would hold for partners three, four, five, etc, etc, ad infinitum.  This is illustrated on the following graph.



We see two economic principles at work.  The first is “economies of scale”.  The more partners, the lower the contraceptive cost per partner.  The second is incentives.  The more people that are involved, the more each participant saves.  For a “working girl” in Vegas or simply a patriotic volunteer during Fleet Week, the cost share could approach zero for all concerned.

Even the most hard bitten Socialist would have to admire such distributive justice.

Now here’s a Lucky Strike Extra for National Security worry warts.   Uncle Sam would, for the first time ever, have a vivid picture of who’s in bed with whom.  Literally.

Applying simple economics to what, for Governor Huckabee, is a thorny political problem fairly distributes costs upon those who are receiving erotic utility while sparing non-participating taxpayers the double insult of not getting any while paying for others’ good times.  And this does not even count the treasure trove of information that will accrue to the national security state at no additional cost.


We are here to help and happy to do so.


Subscribe to the 2 Percenter blog by going to http://feedage.com  and entering 2percentpov into the Search box on top -choose your favorite reader.

Go back to:  2 Percenter Home      Article Archive
 Connect through:
Facebook     Twitter     E-mail     
OnFire Radio Show
Streaming  on Hamiltonradio.net

"Half the people are stoned and the other half are waiting for the next election.
Half the people are drowned and the other half are swimming in the wrong direction."
Paul Simon




Wednesday, January 22, 2014

Work 40!

For the past half decade the White House has combated childhood obesity via the First Lady’s Play 60 campaign.  The idea is to get kids up off their butts, away from video games and to head outdoors for vigorous exercise like tag, dodge ball, touch football, hop scotch, etc like kids did back in the old days.


Bully for you, FLOTUS!

Now is the time for the for the First Family to step back up to the plate to get America’s grownups to put down the remote, turn off Dr. Phil, get out of the house and back on the job.  Ladies and gentlemen, I give you Work 40!



You don’t need me to rehash the facts – ongoing high unemployment, record low workforce participation, record high long term disability claims and extended unemployment benefits.  Evidently North Carolina has put its foot down on perpetual jobless benefits and it seems to be working.   The liberal media begs to differ.

If we put all partisan bickering aside, it is clear that people do not need to econ majors to make decisions on the margin.  If you can sit at home for $40K a year or work for $50K, it’s a no-brainier that you are really working for only $10K.  Only a fool would do that. 

Incentives matter.  The Cato Institute illustrates how it is financially more advantageous to live on government assistance as opposed to going to work.


It’s high time we got behind a culture change like “Work 40!” rather than incentivizing sloth.

Subscribe to the 2 Percenter blog by going to http://feedage.com  and entering 2percentpov into the Search box on top -choose your favorite reader.

Go back to:  2 Percenter Home      Article Archive
 Connect through:
Facebook     Twitter     E-mail     
OnFire Radio Show
Streaming  on Hamiltonradio.net


"Half the people are stoned and the other half are waiting for the next election.
Half the people are drowned and the other half are swimming in the wrong direction."
Paul Simon




Sunday, January 12, 2014

Smoking Our Way To Solvency?

Colorado now boasts “about 130” legal retail pot shops” writes USA Today.  According to the article, those stores anticipate a combined $600 million in year one sales of which about $130 million will end up in the state’s coffers.  However, this will not be pure windfall for the Centennial State as goodly portion will be devoted to regulation and policing of the nascent industry.



One customer, David Strong, age 59, is quoted as saying that, "If they legalized this stuff back in '68, the government would be out of debt right now."  He’s wrong about that and here’s why.

First, sin taxes are always self defeating.  Politicians do not want to be seen as advocating bad behavior.  Therefore, they rationalize taxation on booze, gambling and tobacco as deterrents - raising the price of vice.  On top of that, the governments that benefit from sin tax revenues inevitably mount anti-smoking, responsible drinking and responsible gambling campaigns that aim to curb or kill the geese that lay the golden eggs.

We also see the inverse of this. Government will suppress virtuous behavior when that good behavior hits the state in the wallet.  Such is the case with high efficiency / high mileage vehicles.  While most states are supposedly trying to conserve energy and limit carbon emissions, several, including the Pot State, are laying special taxes on electric and hybrid vehicles because their drivers are paying little or no tax at the gas pumps.

The second reason why weed taxes will not balance budgets is that new revenue streams fail to address the real fiscal problem – out of control government spending.

States promised that lotteries, off-track-betting, sports betting and casino gambling would be magic bullets to fund education, senior care and urban renewal.  Time and time again they fail and state governments continue to cry poverty.


State taxpayers will only find relief when they pressure their elected officials to cut spending.  This includes benefits and pension funding for public employees.  It probably won’t help if those taxpayers are stoned. 




Subscribe to the 2 Percenter blog by going to http://feedage.com  and entering 2percentpov into the Search box on top -choose your favorite reader.

Go back to:  2 Percenter Home      Article Archive
 Connect through:
Facebook     Twitter     E-mail     

OnFire Radio Show
Streaming  on Hamiltonradio.net

"Half the people are stoned and the other half are waiting for the next election.
Half the people are drowned and the other half are swimming in the wrong direction."
Paul Simon