Posts tagged with: Business/Finance

rubio-leeWhat is the Rubio-Lee Plan?

The plan—officially titled the “Economic Growth and Family Fairness Tax Plan”—is a white paper in which Senators Marco Rubio (R-Florida) and Mike Lee (R-Utah) lay out a tax reform proposal they believes will “resolve these major problems in the tax code.”

What’s in the plan?

The plan has two main sections, one “pro-growth” and one “pro-family.” The pro-growth side of the plan includes seven recommended changes:
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Blog author: dpahman
Friday, February 27, 2015
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Yesterday the FCC reclassified Internet Service Providers (ISPs) as a telecommunications service under Title II of the Communications Act, with additional provisions from Title III and Section 706 of the Telecommunications Act of 1996. This was done for the purpose of ensuring net neutrality or open internet access, requiring ISPs to treat all data on the internet equally. Notably, yesterday’s Order also includes mobile broadband for the first time as well.

In a press release, the FCC claims,

Together Title II and Section 706 support clear rules of the road, providing the certainty needed for innovators and investors, and the competitive choices and freedom demanded by consumers, while not burdening broadband providers with anachronistic utility-style regulations such as rate regulation, tariffs or network sharing requirements.

I have expressed concerns in the past about the smattering of regulations available under Title II, far beyond what would be required for net neutrality. On the surface, the press release would seem to indicate that the recent Order was designed to attempt to prevent those further regulations from being available to the FCC: (more…)

and112812blogNear the top of the list of things I despise is companies that take advantage of the plight of the poor and desperate. But just above that on my list is something I hate even more: being poor and desperate. That’s why I loathe payday lending companies that charge usurious interest rates—and why I’m not yet ready to see them abolished.

Here’s how payday lending works. If you have a job (and pay stub to prove it), a payday lending company will allow you to write and cash a post-dated check. For this service the company will charge an absurd interest rate. A typical two-week payday loan with a $15 per $100 fee equates to an annual percentage rate (APR) of almost 400 percent. So if you need $100, you write the check for $115 and they’ll give you $100 in cash. Two weeks later they cash your check or you can renew or “rollover” the amount—for an exorbitant fee.

Why would anyone agree to such terms? Because they have no other choice. About twenty years ago I made some terrible choices and found myself in a serious financial bind. The amount I needed wasn’t much—about $200—but without it I wouldn’t have been able to pay my rent. I took out a payday loan that cost me $30 every two weeks. It took about eight weeks to get clear of the loan, resulting in a cost of $120 to borrow $200 for two months.

If you’re middle class and think of it in terms of interest rate, that repayment cost sounds appalling usurious. And it is. But as the poor will tell you, man does not live on APR alone. Having to pay an extra $120 was cheaper than having to find a new place to live. Yes, it was a bad deal. But it was better than all my other choices.

That is why I believe every serious critique of payday lending needs to be accompanied by a serious proposal to help those who are trapped by such “poverty problems.” An excellent example of an alternative approach is the one offered by Wesley Memorial United Methodist Church in Richmond, Virginia. One of their church members, Nina McCarthy, was initially trapped in the vicious payday lending circle:
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7figuresEach year the International Bulletin of Missionary Research lays out in summary form an annual update of significant religious statistics. Here are seven sets of figures based on their latest report:

1. Global population by religion: Christians – 2.38 billion; Muslims – 1.7 billion; Hindu – 1 billion; atheists – 136 million; Jews – 14 million.

2. Membership by 6 ecclesiastical megablocs: Catholics – 1.2 billion; Protestants – 441 million; Independents – 407 million; Orthodox – 280 million; Anglicans – 92 million; Unaffiliated Christians – 110 million.

3. Number of Christians by 6 continents, 21 UN regions: Africa (5 regions) – 520 million; Asia (4 regions) – 368 million; Europe (including Russia; 4 regions) – 561 million; Latin America (3 regions) – 562 million; Northern America (1 region) – 229 million; Oceania (4 regions) – 25 million.

4. Christian organizations: Denominations – 45,000; Congregations – 4.7 million; Service agencies – 30,000; Foreign-mission sending agencies – 5,000.

5. Christian finance (in US$, per year): Personal income of church members – $35 trillion; Giving to Christian causes – $626 billion; Churches’ income – $249 billion; Parachurch and institutional income – $377 billion.

6. Scripture distribution (all sources, per year): Bibles – 80 million; Scriptures including gospels, selections – 5 billion; Bible density (copies in place) – 1.8 billion.

7. World evangelization: Unevangelized population – 2.1 billion; Unevangelized as % of world: 29.2 percent.

Divestment-600-AEA-1Your faithful correspondent last week exposed the fossil-fuel divestment endgame of religious shareholder activists. As You Sow President Danielle Fugere sees her group’s activities as awareness-raising exercises for climate change, but AYS’s alignment with environmentalist and divestment firebrand Naomi Klein suggests they’d settle for nothing less than nationalizing oil companies. This week, I’m happy to report another group frequently called to task in this space, the Interfaith Center on Corporate Responsibility, opposes the AYS divestment onslaught. Reporting in last week’s Wall Street Journal, Gregory J. Millman writes:

An organization of faith-based and socially responsible investors is pushing back against the call for divestment from fossil fuel companies. At its Winter Conference Wednesday, the Interfaith Center for Corporate Responsibility, which claims 300 member organizations controlling $100 billion in invested capital, called instead for more shareholder engagement with such companies.

“Divestment is one step but a blunt instrument that leaves investors with no voice at corporate tables,” said Laura Berry, executive director of the ICCR.

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The largest initiative to combat poverty by funding public schools has occurred in Camden, New Jersey, the poorest small city in America. New Jersey spends about 60 percent more on education per pupil than the national average according to 2012 census figures, or about $19,000 in 2013. In Camden, per pupil spending was more than $25,000 in 2013, making it one of the highest spending districts in the nation.

But as Reason.com notes, all that extra money hasn’t changed the fact that Camden’s public schools are among in the worst in the nation, notorious for their abysmal test scores, the frequent occurrence of in-school violence, dilapidated buildings, and an on-time graduation rate of just 61 percent.

As Bridget Cusato-Rosa, Principal of Freedom Prep Charter School, says in the mini-documentary about the effort,

A lack of resources is not our problem. I actually despise that argument. I think it’s a scapegoat. ‘We need more money. If we had more money, we could do this, or do this.’ It’s just a Band-Aid for the problem. Why not address the real issue, which is what’s broken right in front of you?

government-regulation-in-business-red-tapeWhat is the annual cost of regulations for America?

The short answer is that no one knows for sure. The officially reported regulatory costs as reported by the Office of Management and Budget (OMB) total up to $128.7 billion. But the real costs of regulation is impossible since, as the Nobel-winning economist James Buchanan said, “Cost cannot be measured by someone other than the decision-maker because there is no way that subjective experience can be directly observed.”

Still, we can attempt to estimate the costs based on factors that can be measured. Clyde Wayne Crews Jr. of the Competitive Enterprise Institute provides an example of such an estimate. His findings:
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china-christiansFor the past three decades China has been the world’s fastest-growing major economy, with growth rates averaging 10 percent a year for 30 years. As Brian J. Grim, founder and president of the Religious Freedom & Business Foundation, notes, there are many reasons for the growth, such as market mechanisms, modern technology and Western management practices. But one factor that is often overlooked is the role of Christianity:
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Friedrich Hayek once called intellectuals “professional secondhand dealers in ideas.” And the Preacher proclaimed, “There is nothing new under the sun.” So perhaps it shouldn’t be surprising when ideas, memes, and other cultural phenomena pop up again and again.

There is, however, a notable correspondence between an Acton Commentary that I wrote earlier this month, “The Worst Christmas Song Ever,” and a piece that appeared weeks earlier at The Federalist. In “‘Do They Know It’s Christmas’ Is The Worst Christmas Song Ever,” Leslie Loftis takes down this miserable tune in devastating fashion. Loftis points out that the song “has a little of everything to loathe. Condescension. Inane inaccuracies. Smugness. Mullets.”

Whether or not you have read my commentary, you should go check out her case against the song now.

I first noticed the song, which heretofore had been background Christmas muzak, when we screened the new documentary Poverty, Inc. earlier this year at the Acton Institute offices. That film includes a section discussing “Do They Know It’s Christmas?”

Matthea Brandenburg helpfully points out some further commentary by Magatte Wade and others about the song over at the PovertyCure blog.

When Christmas rolled around, I had the idea to write something about the song, and connected it with William Easterly’s analysis of the differing perspectives on development offered by Gunnar Myrdal and Hayek. But I now think that even though I hadn’t read Loftis’ piece, I had seen the title before I wrote my piece. In fact, I checked Ben Domenech’s excellent email newsletter The Transom, to which you should subscribe, and there on December 3 is the following: ‘“Do They Know It’s Christmas” is the worst Christmas song ever. http://vlt.tc/1qf7

No doubt I saw the link, and got the idea for calling it the “worst ever” into my head. Then some days later I connected it to the Poverty, Inc. clip and wrote my piece. So the idea for calling this the worst Christmas song ever must be credited to Loftis and The Federalist. I’m sorry that I didn’t realize that Loftis’ piece had already appeared, or I would have pointed to it earlier, and given credit for the idea straight away. So in the interests of disclosure, I certainly haven’t been the only one to criticize this song or even to call it the “worst Christmas song ever.” I guess I’ve got egg(nog) on my face. The variety of voices that find the song problematic, however, should be a indication that there’s something rotten in “Do They Know It’s Christmas?” It is, after all, a song that includes a toast like this: “Here’s to them underneath that burning sun.”

“Do They Know It’s Christmas?” is like a bad earworm that won’t go away. And now I really, really hate that song!

lemonade-stand-illegal-425ds072709Entrepreneurs – those people among us who seek to serve others through business – are an optimistic bunch. So says the 2014 Amway Global Entrepreneurship Report, published annually by Amway Corporation, the world’s largest direct sales company. It’s a good thing entrepreneurs are optimistic; they have a lot of work to do. According to Amway Chairman Steve Van Andel:

Entrepreneurs play an important role in growing economies. They create jobs, encourage competition and help communities grow and flourish. As the business environment has changed through the years, so have the reasons people decide to venture out on their own.”

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