The #YangGang can't do math

Andrew Yang talking to Joe Rogan:

• "[The US is spending] $1.5 trillion on 126 welfare programs and Social Security."
• "The real price tag [for UBI] is $1.8 trillion, if you say everyone who is 18 and up. Now for context, the entire US economy is now $20 trillion... and the Federal budget is $4 trillion."
• "When you put money into people's hands, it doesn't disappear. It's going to go right back into the economy."
• "Of the $1.8 trillion, we're going to get back (let's say) $800 billion in new tax receipts."
• "We're going to save $100-200 billion on things like incarceration, homelessness services, and emergency room healthcare."
• "So, if you look at the cost savings, and the value gains, and the economic growth, that actually gains you back about $1 trillion."
• "The way you get back the last $800 billion... we need to put in a new tax that actually gets the American public a slice of every robot-truck mile, Amazon transaction, Facebook ad."

Let's do the math. (FUN!!!)

The civilian population, ages 16 and over and not in jail, is about 258,392,000. Half of which are currently receiving some sort of government assistance. Even if we assume none of them will receive UBI (which, according to Yang, many will get at least a partial payment), then we are paying out $1.5 trillion AT MINIMUM every year. So at least his estimate of $1.8 trillion is somewhat accurate.

But $1.8 trillion is almost half of the Federal budget of $4 trillion (estimated $4.41 trillion for 2019). Of that $4 trillion, $1.45 trillion is Social Security and $0.45 trillion is welfare. The UBI won't change that, as we are only considering the half of Americans who don't already receive government assistance. So we are adding $1.8 trillion of spending on TOP of the $1.9 trillion already being spent in government handouts. Our budget goes from $4.41 trillion to $6.31 trillion overnight.

"But we get that money back in tax receipts." No we don't. Of federal revenue, ad valorum taxes currently account for $1.6 trillion dollars. Our GDP is about $20 trillion, so ad valorum taxes are about 8% of our GDP. Even if we increase our GDP by the full $1.8 trillion, our ad valorum taxes would only raise $1.75 trillion; an increase of only $150 billion, not $800 billion.

Let's say we place an income tax on the UBI (which is stupid to tax government handouts, but it already happens in many instances). We currently get $2.4 trillion in income taxes, which is about 12% of GDP. We add the same $1.8 trillion, in its entirety, to the GDP and tax it at 12%, we get about $200 billion. So far, between ad valorum and income taxes, took back about $350 billion of the $1.8 trillion.

(EDIT) I just learned that Hauser's Law says:

In the United States, federal tax revenues since World War II have always been approximately equal to 19.5% of GDP, regardless of wide fluctuations in the marginal tax rate.

Ad valorum = 8% of GDP. Income tax = 12% of GDP. Total revenue = 20% of GDP. Damn I'm good (even if by accident).

Saying we're going to save money on incarceration by paying people is to deny reality. The people who already get government funding are the most likely to commit crimes. Yang said he's not going to be paying people UBI to those getting government money (or at least not more than his magic $1000/mo). So the people who are committing the most crimes wouldn't see any more money. No more money = no less recidivism. Therefore, $0 dollars gained.

As for saving on healthcare, we are making the logical leap that some of the UBI will be spent on health insurance and preventative healthcare. If it is, then it's not being put toward very much of the GDP, ad valorum taxes, or income taxes. But let's play along, shall we? Federal spending on healthcare, after you remove services like senior care and R&D, which will not change, we're spending about $500 billion federally. Most of this, $400 billion, goes to the states for services which would include those pesky emergency room visits. Even if we reduce this by half (which is overestimating, but let's be generous), we are only saving $200 billion.

So, with $150 billion from ad valorum taxes, $200 billion from income taxes, $0 dollars from reduced incarceration, and $200 billion from reduced healthcare costs, we have a grand total of $550 billion of the needed $1.8 trillion. We need to create new taxes, such as the Value-Added tax (VAT), and raise $1.25 trillion.

Where. Does. That. Money. Come. From?

This is where the logic breaks down between liberals and money. They think the following:

1. Money put into people's hands goes into the economy.
2. Money taken from them through taxes comes from magic fairy dust.

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figures:

Income Taxes = 37% total 
Social Insurance Taxes = 23% total 
Ad valorem Taxes = 24% total 
Fees and Charges = 9% total 
Business and Other Revenue = 7% total

Income Taxes = $2.4 trillion 
Social Insurance Taxes = $1.5 trillion 
Ad valorem Taxes = $1.6 trillion 
Fees and Charges = $0.6 trillion 
Business and Other Revenue = $0.5 trillion 
Total Direct Revenue = $6.5 trillion

Income Taxes: Individual and corporate income taxes.
Social Insurance Taxes: FICA taxes, unemployment, disability taxes.
Ad valorem Taxes: Sales, excise and property taxes, licenses.
Fees and Charges: Fees for government services other than taxes.
Business and Other Revenue: Revenue from government businesses such as liquor stores and utilities.

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source:
Joe Rogan Experience #1245 - Andrew Yang - Streamed live on Feb 12, 2019
Total Government Revenue in the United States - Fiscal Year 2019
Labor Force Statistics from the Current Population Survey - Civilian noninstitutional population - Age: 16 years and over
We've Crossed The Tipping Point; Most Americans Now Receive Government Benefits - Forbes - by Merrill Matthews - Jul 2, 2014
Total US Government Spending
US Gross Output for 2017 Released

Why "Beto" should have won in a Red State and failed

"Beto O'Rourke came so close to beating Ted Cruz! Which is amazing because Texas is such a Red State™!"

"Beto should run for President in 2020! He had such a great turn-out in Texas, which is such a Red State™!"

These are the kind of things I've been hearing about the coming messiah, Robert Francis 'Beto' O'Rourke. I've heard how close he came to beating Ted Cruz, which shouldn't have been possible in a Red State™ like Texas.

Yes. I'm trademarking "Red State™" when it comes to Texas, because this couldn't be further from the truth. Texas used to be Republican-Red for many years. But demographics have been changing, and not in a natural, organic way. Like much of the rest of the country, the high-density population centers have become more Democrat-Blue. The rest of the country tends to have remained the usual mix of Democrat-Republican that should be normally expected. Sure, rural America has tended toward Republican since the 60's. That's a discussion for another post, but suffice it to say, there are common ideals held between the conservative and self-reliant American farmers and the Republican party.

There may be several reasons for it, but one obvious reason may be one of demographics:

• Urban areas have greater numbers of poor and low-income families.
• Urban areas have greater numbers of poorly educated with crumbling school systems.
• Urban areas have greater numbers of ethnic and racial minorities.

Don't read too much into that last one. Being ethnic / racial minority does not mean you are liberal or conservative. But there are social pressures which do occur in those communities to vote particular ways. Voting for a Republican may be cause to be called a "race-traitor" or worse. In addition, there are consolidated efforts in these areas to provide education and media which tells them they need to vote in their "self-interest" for liberal policies.

So let's look at the state of the State of Texas for a moment. There are thirty-six Congressional districts in the state for the US House of Representatives. Of those 36, twenty-four are held by Republicans. Sounds like a Red State™, doesn't it? In 2018, all 36 districts held a vote. Of these 24 Republican-held districts, 3.6 million voted Republican and 1.6 million voted Democrat. Sounds like a very solid Red State™ with 69% voting Republican.

But there are thirteen Democrat-held districts in Texas. In 2018, those districts voted 2.2 million Democrat to 0.6 million Republican. That's 80% voting Democrat in these districts! Those districts are firmly under Democrat control. For one-third of the districts in Texas, they are very far from being a Red-State™.

What about the State of Texas as a whole? Is it a bonafide Red State™ still?

Combining the votes from both Republican and Democrat districts, there were 4.1 million Republican votes to 3.8 million Democrat votes. That'a 52-48 split in a state that is supposed to be "solidly a Red State™"!

Guess what the vote split was between Cruz and Beto? Cruz had 4.2 million and Beto had 4.0 million. That's a 51-49 split; one-percent better than the state average.

Texas is not a Red State™. And this is only being driven by demographics in urban areas.

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source:
Texas Midterm Election Results, By ABC NEWS - Nov 6, 2018

The ole' switcheroo

"The Republican and Democrat parties switched."

I'm hearing this less. What worries me is that I'm probably not hearing it much because it has become an accepted fact (even though it's not true, but we'll get into that). So, I've already asked about the racist Senator Robert Byrd, elected continuously by the Democrats of West Virginia from 1950 until his death in 2010. I can't get anyone to point out when he or, more importantly, when his constituents switched parties.

So I'm going to ask the same of the southern states. In the South, there are many cities which are currently Democrat strongholds. These cities are unlikely to vote in anything other than Democrat mayors. So, if the party switch theory holds true, then these cities must have had Republican mayors during the time of the Civil Rights Act of 1964. Right? And if not then, surely the Republicans had the run of the place after the Civil War ended in 1865. Right? Surely there isn't an unbroken string of "racist-Democrats" in the racist-South up until modern day.

At some point, the constituency voted in the "non-racist-Republicans" who eventually transformed into the "non-racist-Democrats" of today.

Right?

Wrong.

Atlanta:
From 1855 until today, there have been two terms where the mayor of Atlanta was Republican (1871-1872 & 1877-1879).
157 years Democrat - 5 years Republican

New Orleans:
From 1866 until today, there have been two terms where the mayor of New Orleans was Republican (1867-1868 & 1870-1872).
146 years Democrat - 5 years Republican

Washington D.C.:
From 1910 until today, there have been zero terms where the mayor of Washington D.C. was Republican.
During a period from 1878-1967, the "mayor" was a Board of Commissioners appointed by the President of the United States. The president of the Board, elected by the Board, served as the city's Chief Executive, acting essentially as a "mayor". In all that time, there were only three Republicans who served as the president of the Board.
107 years Democrat

Richmond, VA:
Since 1840 until today, there have been two terms where the mayor of Richmond was Republican (1868-1870 & 1988-1990).
171 years Democrat - 6 years Republican