On Stimulating the Economy

How do we get there?

WARNING!  If you are one of my conservative friends this post may make your head explode.  If you are one of my liberal friends - yes, it really is me.

It is apparent that what the economy needs is an increase in job growth and consumer spending.  I don't claim to be an expert on the economy or tax policy but it seems to me that one quick way to get there is through a revision in the FICA tax.  In 2010 Social Security taxes of 6.2% were imposed equally on employees and employers on every dollar earned up to $106,800.  No Social Security taxes are collected on wages above this amount.  For 2011 the rate for employees was temporarily reduced to 4.2%.  This tax is particularly regressive and represents the major tax burden on low wage workers as well as a significant cost to small employers.

A simple solution that has a little something for everyone:

1. Eliminate permanently the Social Security tax for both employees and employers on the first $20,000 of wages.

Eliminating this tax for employees would be a significant reduction in the tax burden on lower income workers.  It would give them additional disposable income that would provide an immediate economic stimulus.  Eliminating it for employers would reduce the cost of labor providing incentive to hire more employees.  Republicans and democrats should both be happy with tax relief, economic stimulus and job creation.

Now the hard part - making up the lost revenue without making everyone crazy.

2. Maintain the current cap of $106,800 but reimpose the Social Security tax on all income above $500,000.  This gap would result in a relatively small tax decrease for most in the middle class; however, workers earning very high salaries and bonuses would be taxed on those.  Employers who provide those extraordinarily high compensation packages would also have an increased tax burden which could provide a disincentive to compensate highly unless there is a genuine reason for it.  Additionally, specifying all income above $500,000 would prevent the very wealthy with high investment income from avoiding this tax.  Republicans and Tea Partiers aren't going to like this very much.  Democrats and Warren Buffet would be very pleased and the Social Security fund would benefit.

I don't pretend to be an economist or even believe much of what I learned in economics.  One of the concepts I do believe in is marginal utility of income.  Clearly 6% of every dollar that a $25,000 administrative assistant earns is a much heavier burden to that person than 6% of Warren Buffet's last $1,000,000 is to him.  The hedge fund manager who gets a $1,000,000 bonus may not like paying that extra 6% but she can afford it.

#justsayin



On Change We'd LIKE to Believe In

Jonathan Rockoff writes in The Wall Street Journal,

“Four years ago, Pfizer Inc. was on the verge of abandoning a cancer therapy that had shown little promise. Then scientists discovered it did work, but only in people with a particular genetic anomaly—as few as 6,000 patients a year in the U.S.

In recent years, Pfizer probably wouldn't have considered such a small market worth further investment, company employees say. Yet today, that experimental therapy is Xalkori, newly approved for a rare form of lung cancer, for which Pfizer plans to charge $115,200 a year per patient.” (August 30, 2011)

So, what if you are one of the 6,000 who could benefit from this drug but don’t happen to have $115,200 per year?  This is the fear that nags at many Americans and is precisely why a number of them voted for Barak Obama for president when he promised health care reform.  The vast majority of Americans have health insurance that covers most illnesses or accidental injuries they might confront.  Their fear is that they or a member of their family will suffer a catastrophic illness or injury for which cost of treatment even with insurance will far exceed the limits of their financial resources.

Families are required to consume all of their personal resources before the government provides medical assistance.  I find it unconscionable that hard working, middle class citizens cannot afford to get sick in the richest, most prosperous country in the world.  I believe that when candidate Obama spoke so passionately about the need for health care reform he implied, and most voters believed, he was proposing to provide a safety net to protect families from financial ruin resulting from catastrophic circumstances.  This is not what he, Nancy and Harry delivered.  

I do not necessarily believe the current program should be repealed.  It does provide coverage to many who need it.  It needs to be fixed.  It needs a middle class safety net.

#justsayin

Liberal, Conservative or the Third Way?

Many identify themselves and their political affiliation as politically "liberal" or "conservative".  Unfortunately, in my opinion, they have it all wrong and don't have a clue.  The key issue is that word "politically".

A politically conservative party should be that party that advocates for the "conservative" use of government.  This should mean conservative in terms of size, spending and intrusiveness by the government into the everyday lives of our citizens.  Members of this party would expect government to play only a limited role defined by a strict reading of the Constitution.  This once was the domain of the Republican party and is what many registered Republicans (and Democrats) still believe.

A politically liberal party would be the party that believes government should play an expanded role in our lives. A liberal political party would engage in large government agencies that engage in extensive spending and shape the face of society.  This is supported by a liberal, interpretive reading of the Constitution.  This position is aligned with what most people see as the Democrat party.

What we have with the two major parties in the U.S. is not a plolitically conservative versus a politically liberal party.  We have two politically liberal parties, one with a "conservative" social philosophy and the other with a "liberal" social philosophy.  Each is liberal in the sense they are willing to use both the club and cash of government to advance their social agenda.

What the country needs and what, I believe, most voters want is a party that will provide necessary government functions without unnecessarily intruding in our lives.  One alternative has been the Libertarian party which is not particularly clear on its position regarding the size and scope of government but is clear regarding the role of  government in the private lives of citizens.  Unfortunately, this party is seen as so closely aligned with NORML that it has little chance of success.

An interesting recent development is described at http://www.americanselect.org/. This is an internet based movement which they describe this way, 

"Americans Elect is the first-ever open nominating process. We're using the Internet to give every single voter—Democrat, Republican or independent—the power to nominate a presidential ticket in 2012. The people will choose the issues. The people will choose the candidates. And in a secure, online convention next June, the people will make history by putting their choice on the ballot in every state."

The only way we can get our country back on the right track is for voters to get involved.  It is time we stopped settling for the Kool-Aid the Republicans and Democrats are serving up.

It might be time for a third way.  #justsayin

On Crossing the Rubicon

The Die is Cast

What do these have in common?

Julius Caesar crosses the Rubicon.

Cortez orders his men to burn their ships.

MacArthur orders an amphibious landing by the marines at Inchon.

Rosa Parks takes a seat in the front of the bus.

When Caesar crossed the Rubicon he committed an act (arguably treason) from which there was no turning back.  He could never say, "It was an accident," “I didn’t mean to do it” or “Just forget about it.”  He had passed a point of no return.  Hence the modern meaning of the phrase "Crossing the Rubicon."  Each of the above is an example of a bold individual making a conscious decision and taking action from which there was no return.  There are innumerable examples such these throughout history; however, crossing the Rubicon does not mean world history has to be altered.  Crossing the Rubicon simply means you were willing personally or professionally to be bold. 

The consequences are not always known in advance.  Sometimes they are good.  Cortez prevailed in his conquest.  Whether that was for good or evil is still debated.  The landing at Inchon changed the path of the Korean War and Rosa Parks helped advance the civil rights movement in the United States.  Caesar, on the other hand, became dictator of Rome and was assassinated after only a year in power.  All faced potential disaster that could have far reaching impact.

Would Caesar have acted differently if he had known the outcome in advance?  I think not.  Bold individuals make bold decisions and pursue them.  The weak either never cross the Rubicon or try to meekly wade back across when they get to the other side and are weighed down with doubt or adversity.

Some don’t even know where their personal or professional Rubicon is to which I say, “Get a map and get moving. Cross the Rubicon.  Jacta alea est.”  #justsayin

This has been posted here as well as in drcamey on marketing.  It should speak to us both individually as well as professionally.

On Being Called

I am feeling a bit cynical this evening.


Let's go back a few weeks to before Gov. Perry declared his intention to seek the presidency of this great country.

This according to the Des Moines Register:

"I’m not ready to tell you that I’m ready to announce that I’m in,” Gov. Rick Perry told The Des Moines Register. “But I’m getting more and more comfortable every day that this is what I’ve been called to do. This is what America needs.”

"...called to do..." This may be an innocuous piece of phraseology to many Americans. To those in the evangelical Christian community the meaning is quite clear. We have become completely familiar with people we know being called. With younger individuals it is most often to a missionary endeavor or to the ministry. When we hear it from more experienced and seasoned professionals it is in the form of "I have been called to..." someplace else. The code is that God has spoken to me in some way and this is what he wants me to do therefore "It is Good."

My observation (and I do not pretend to be aware of all cases) is this. I have not seen one pastor, youth minister, music minister or anyone else in a church "called" to sacrifice and move to a smaller ministry position with a smaller salary. I am sure it must have happened but I suspect it is the exception to what I see as a rule

So, when I see any politician suggest that he has been "called" to the highest elected office in the land I am just a bit cynical - especially when they accept the call. I suspect that Gov. Perry's response to the call might have been a bit different if it had been the call to serve as mayor of Oak Point. It seems God never sends anyone down to the minors. He only calls them up to the majors. #justsayin

An Introduction

I am a professor of marketing, assistant dean and director of assessment in the College of Business at the University of Central Oklahoma in Edmond, OK. I've been wanting to start a blog for some time. I want to write about marketing. The problem is, I want to write about a lot of other things as well. It strikes me that the target markets for what I want to write about is somewhat disparate. The only solution I could come up with is - two blogs.

Not being very clever I gave them simple names.

There is this blog: drcamey on everything and its companion blog: drcamey on marketing.

You see, I love marketing and love sharing what little I know about marketing theory and best practices; however, I came to the academic world after a career in the U.S. Coast Guard. I have lived and worked all over the world from the island of Con Son to the island of Iceland. I like to think I am not an ivory tower academic. Rather, my life experiences have broadened my interests to the extent I am interested in and have opinions on many topics.

This blog will be a bit unfocused. I plan to write about whatever strikes my interest. It may include politics, social issues, whatever I come across on the web, fun things, college football...you get the idea. If you want a taste of my other interests - marketing and marketing education issues, visit drcamey on marketing.

I look forward to your comments. Engage me. Challenge me (and yourself). Make this fun.