This and that: Doctor with roots here on 'Paula Zahn Now'

Wednesday, March 29, 2006

Dr. Mark Stacy, formerly of Cape Girardeau and son of Jane Stacy, Southeast Missouri State University alumni director, was the featured doctor interviewed on an 11-minute segment of "Paula Zahn Now" on CNN last week.

Dr. Stacy is a leading specialist in Parkinson's disease and is based at Duke University. He discovered that about 5 percent of those on a dopamine drug to help control the symptoms of Parkinson's disease could be affected with compulsive behavior such as gambling and overeating.

It was an interesting interview. And it was nice to see another hometown boy doing well in his chosen field.

The Centers for Disease Control and Prevention report last November titled "Abortion Surveillance -- United States 2002" reported 8,201 abortions in Missouri that year.

According to a U.S. Department of Education 2002-2003 school year report, Missouri's average per-pupil spending was $7,462.

In the same report 31 percent of eighth-graders were at proficiency or better in reading, and 26 percent were at proficiency or better in math.

Unbelievably, that was about the average of proficiency ratings of all states regardless of per-pupil spending.

Beltway windfall: The next time some Washington potentate moans about the budget deficit, tell him not to blame the taxpayers. They're already doing their part to reduce it, as the latest Treasury figures on booming federal tax revenue show.

In the first five months of fiscal year 2006, through February, overall revenue continued to surge, growing at an overall rate of 10.3 percent, or an $81 billion increase from the year ago period, to $871 billion. That builds on the astonishing 15 percent, or $274 billion, revenue increase for all of 2005, which various fiscal wise men assured us would fall off dramatically. Apparently not.

This year's double-digit increase is roughly triple the rate of inflation, reflecting strong gains in business profits and individual wages and bonuses -- both signs of a vibrant underlying economy. Corporate income taxes are up 30 percent so far this year, while individual income tax payments have climbed by 10.3 percent through February.

The bad news continues to be federal spending, with overall government outlays up 7.6 percent, or $76 billion, to $1.09 trillion. Defense spending is up 7.5 percent, but Medicare is growing at a 10.4 percent pace, which promises only to increase as the prescription drug benefit kicks in. As ever, the elephant in the budget is entitlement spending on seniors.

Economist Michael Darda points out that overall spending has risen at a 6.6 percent annual pace since 2001, or more than double the 3.1 percent average rate of increase between 1993 and 2000. If spending in this decade had merely stayed at the 1990's pace, the budget would already be in surplus by $143 billion, according to Mr. Darda's calculations. Some of this increase has been in defense, which was necessary after the rapid declines in security spending during the Clinton years. But the failure of GOP fiscal governance has been in spending on both guns and butter.

As for taxes, the revenue data are further proof of the success of the Bush tax cuts of 2003. The fastest way to stop this revenue windfall, and blow an even larger hole in the deficit, would be to fail to extend the 15 percent tax rate on capital gains and dividends through 2010, thus assuring a huge tax increase after 2008. The fear of such a tax hike is already weighing on investors and stock-market valuations. So what are GOP House-Senate tax conferees waiting for?

-- The Wall Street Journal

"Star Wars" film legend George Lucas wants more worldly Hollywood: Legendary "Star Wars" film creator George Lucas told a packed house the United States is a provincial country with a culture that has invaded the world via Hollywood.

Lucas made the comments as he was honored with a Global Vision Award by the World Affairs Council in a downtown San Francisco hotel ballroom.

"As long as there has been a talking Hollywood, Hollywood has had a huge impact on the rest of the world," Lucas said as he discussed his films and enhancing education with computer technology.

"It shows all the morality we espouse in this country, good and bad. The French were the first to start yelling cultural imperialism." Some people in other countries are troubled by what they see as U.S. culture "squashing" local art and cinema, Lucas said.

"I hate to say it, but television is one of the most popular exports," Lucas said.

People see shows such as "Dallas," about a wealthy Texas oil family, and decide they want the grand lifestyles portrayed, according to Lucas.

"They say that is what I want to be," Lucas said. "That destabilizes a lot of the world."

"There has been a conflict going on for thousands of years between the haves and the have-nots, and now we are in a position for the first time to show the have-nots what they do not have." Lucas endorsed U.S. students studying abroad to help imbue them with more global perspectives.

An onus is on filmmakers to be careful with the messages they send because they speak "with a very loud voice," the famed movie director said.

-- ADP

It's always amazing to listen to conventional demand-side economic pundits and mainstream reporters who try as hard as they can to minimize the excellent performance of the economy ever since lower marginal tax-rate incentives were put into place almost two-and-a-half years ago. The latest chant is that a warm winter has artificially stimulated consumer spending and that a day of reckoning marked by a housing-price crash and an overwhelming debt burden is headed our way. This is utter nonsense.

Apart from the inherent resiliency of our free-market capitalist economy, the fact remains that tax-induced capital cost reduction and resulting higher investment returns have boosted investment, healed business woes and created employment growth near 2 million new jobs a year (and nearly 5 million since the middle of 2003, when the Bush tax cuts were implemented).

Reagan economic guru Art Laffer taught us 30 years ago that lower tax rates ignite economic growth. Now, the Laffer curve is tracking a business-led expansion that is throwing off record budget revenues, while corporate profits are soaring. Profits are the mother's milk of business, the economy and stocks, and are laying the foundation for even heftier job gains.

According to the Fed, after-tax profits for last year's fourth quarter hit 9.1 percent of GDP, a post-World War II record. At a trillion dollars, profits are way ahead of their prior peak in 1999 and have nearly doubled since their recent trough in 2001. Family net wealth, the nation's true savings rate, advanced 8 percent in 2005, to a record level of $52 trillion.

-- Lawrence Kudlow

Gary Rust is chairman of Rust Communications.

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