George F. Will: Questions for Obama | Newsweek George F. Will

I found this column highly dissappointing . Among my issues with his rant:
1. Drug cos- The point is that drug companies essentially get a limited monopoly on new drugs, and they are allowed to charge whatever they want, and the govt agrees to pay whatever they want, and the govt is not allowed to negotiate price at all, so its all just a big subsidization to the drug companies. The fact that he did not address this particular point makes him either dishonest or ill informed.
2IExxon - I guess this tells me that Will really doesn't understand company financials. Profit as a percent of revenue is not terribly meaningful. Profit as a percent on investment is more meaningful, and their ROE's are in the 30's, which is very high. Only other industry's with that kind of ROE I can think of are Pharma (due to monopoly and govt subsidizaton) and Microsoft (effective monopoly) As far as ownership of mutual funds, a vast majority of that ownership is upper income folk.
3.Increase in per capita income - the MEDIAN FAMILY income has only increased about 1% year since 1970, and most or all of that increase can probably be attributed to more females entering the work force, so effective individual MEDIAN incomes have been flat or declining for almost 40 years. To throw out per capita income, which is a function of a mean/average does not address the point that "most americans lives have gotten worse". Also, I have seen statistics that over the past 30 years, the median retirement savings, when you take into account personal savings, pensions, and social security has also gotten worse. In terms of the size of the american home, how much of that is just due to borrowing more?
4. Cap gains -Over the long run capital gains tax cuts don't typically increase revenue. There is little evidence to suggest a 20 or 25% cap gains tax rate would hurt govt revenue or the economy. Even Greenspan has said as much.
5. FICA Issue - When I first saw the print edition, where Will Asserts that a married couple making a combined income of about $140K would end up paying more FICA. I thought at the time surely he is not so ignorant as to realize that the FICA cap was PER PERSON, not per couple, but I guess he was wrong (he IS that ignorant).

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Posted By: L-Boy @ 05/30/2008 1:56:16 AM

I found this column highly dissappointing . Among my issues with his rant:
1. Drug cos- The point is that drug companies essentially get a limited monopoly on new drugs, and they are allowed to charge whatever they want, and the govt agrees to pay whatever they want, and the govt is not allowed to negotiate price at all, so its all just a big subsidization to the drug companies. The fact that he did not address this particular point makes him either dishonest or ill informed.
2IExxon - I guess this tells me that Will really doesn't understand company financials. Profit as a percent of revenue is not terribly meaningful. Profit as a percent on investment is more meaningful, and their ROE's are in the 30's, which is very high. Only other industry's with that kind of ROE I can think of are Pharma (due to monopoly and govt subsidizaton) and Microsoft (effective monopoly) As far as ownership of mutual funds, a vast majority of that ownership is upper income folk.
3.Increase in per capita income - the MEDIAN FAMILY income has only increased about 1% year since 1970, and most or all of that increase can probably be attributed to more females entering the work force, so effective individual MEDIAN incomes have been flat or declining for almost 40 years. To throw out per capita income, which is a function of a mean/average does not address the point that "most americans lives have gotten worse". Also, I have seen statistics that over the past 30 years, the median retirement savings, when you take into account personal savings, pensions, and social security has also gotten worse. In terms of the size of the american home, how much of that is just due to borrowing more?
4. Cap gains -Over the long run capital gains tax cuts don't typically increase revenue. There is little evidence to suggest a 20 or 25% cap gains tax rate would hurt govt revenue or the economy. Even Greenspan has said as much.
5. FICA Issue - When I first saw the print edition, where Will Asserts that a married couple making a combined income of about $140K would end up paying more FICA. I thought at the time surely he is not so ignorant as to realize that the FICA cap was PER PERSON, not per couple, but I guess he was wrong (he IS that ignorant).
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Posted By: olderwiser @ 05/27/2008 1:00:39 PM

Anyway, George, I am grateful for the opportunity that you gave me to write a tome or two. I always like to read your extremely well written articles wherever I can find them. Maybe after the election's over we can go fishing together and let you get even with me while I try to catch a fish.
¿Quien sabe?
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Posted By: olderwiser @ 05/27/2008 12:55:34 PM

How sad it is to see children in Afghanistan and Iraq just sit there and rock back and forth studying in an educational system with just one measly book. That, George is faith based education, and that is where faith based education always leads. Fewer and fewer books, and instead of trusting in campaign promises, trusting in what might fall from the sky where you know whom lives. The Big President in the sky. The left has sense enough to leave that crap separate from government where it belongs. Among faithful families doing it their way and not the government way.
Left, George, left. And there's little that you can do about it.