No, it isn’t Islam — it’s Marxism.

[Update a few minutes later]

This seems related, somehow. How is Warren Buffett like the Pope? They’re both completely clueless about how economies work:

The great advantage of competition in markets is that it exhausts all gains from trade, which thus allows individuals to attain higher levels of welfare. These win/win propositions may not reach the perfect endpoint, but they will avoid the woes that are now consuming once prosperous economies. Understanding the win/win concept would have taken the Pope away from his false condemnation of markets. It might have led him to examine more closely Spain’s profligate policies, where high guaranteed public benefits and extensive workplace regulation have led to an unholy mix of soaring public debt and an unemployment rate of 20 percent. It is a tragic irony that papal economics mimic those of the Church’s socialist opponents. The Pope’s powerful but misdirected words will only complicate the task of meaningful fiscal and regulatory reform in Spain and the rest of Europe. False claims for social justice come at a very high price.

A similarly harsh verdict must be rendered on Warren Buffett, whose much discussed editorial in the New York Times foolishly condemns the very economic system that allowed him to flourish as an extraordinary investor. Rhetorically, Buffett’s editorial reads like the confession of a man who got away with putting his hand in the cookie jar. He starts by insisting that in difficult times the principle of “equal sacrifice” should guide collective deliberations. In good autobiographical fashion, he then admits that the current tax system has allowed him to get away with paying just under $7 million in taxes this past year, which works out to be 17.4 percent of his $40 million personal income.

In Buffett’s utopian world, higher taxes, including higher capital gains taxes, magically generate the revenues needed to eliminate the current massive deficit. For this bold proposition, we have Buffett’s personal assurance that he has never seen capital gains rates that approach 40 percent “scare off” large or small investors. This is a simple case of sampling error, for those people who are scared off by high capital gains taxes don’t beat a path to his doorway in the first place. It would have been better if Buffett had addressed the “lock-in effect” with respect to capital gains. People only pay capital gains when they sell their stock. Accordingly, investors are highly sensitive to the capital gains rate, because why sell if the net proceeds from the sale are so small that they more than negate a higher rate of return from a shrunken capital base?

On this logic, lower capital gains rates generate more tax revenue for the federal government.

Of course, according to the president, it doesn’t matter. All that matters is “fairness.”

Apparently, Arne Duncan has been ignorantly channeling Paul Krugman. Derbyshire (and Iowahawk) take him to school.

[Update a few minutes later]

Speaking of the crazy economics professor, Ed Driscoll reviews his latest antics.

I should add (as I have before) that it’s important to understand just how and why WW II ended the Depression. The conventional wisdom from the Keynesians is that all of the federal spending grew the economy, but that didn’t really happen — wars are in fact ruinous for economies, even for those economies that win them. Much of the production that occurred during the war was consumed in the war, or scrapped afterward, while there was rationing of food and goods on the home front. The real reason that we recovered was that once the war was on, FDR was too distracted by it to continue to tinker with the economy, as he had during the thirties, keeping it continually sick (much like a medieval doctor continuing to bleed a patient). He had to get arms production up and could no longer afford all of his random pet nostrums. Beyond that, unemployment plunged because so many men were drafted, taking them off the rolls, and then the women were put to work in the factories.

Had Roosevelt lived, after the war, he probably would have returned to his damaging tinkering, and in fact Truman wanted to, but the new Republican Congress that came in in 1946 wouldn’t let him, and so finally, after a decade and a half of disastrous Democrat policies, the economy finally recovered, and even boomed. But it doesn’t mean that the solution is a war, or even the “moral equivalent” of one. It means that the solution is sane government. I hope that we’re less than a year and a half from that.

[Update a while later]

The leftists can’t make up their minds about it.

…from Sweden.

Better late than never. “Never” is when I suspect we’ll get anything similar from much of the American left.

Probably not:

There appears to be a subtext in the piece: cometh the hour, cometh the man. But let us not forget that David Cameron’s first instinct, what he chose to promote to the first order of business in a recalled Parliament, was to blame social media, and moot the prospect of shutting down the country’s telecommunications systems at the first hint of a disturbance. Once again, the symptoms and not the causes are being addressed. This is because addressing causes is unpopular and difficult. It is depressing to note that the only prime minister since the Second World War who has had the honesty to candidly and repeatedly speak the truth about the consequences of our post-war welfare fetish was Margaret Thatcher: She pulled no punches, she did not dress up her sentiments or obscure the harshness of her message to such an extent that it lost its meaning, and she revelled in taking on who she saw as the enemies of liberty and of civilization (the socialists at home, the Soviet Union abroad). The result? The economy rallied and Britain was saved from what looked like terminal decline. Her reward? To be generally loathed for being “harsh,” even by many of those who would broadly agree with her.

Mrs. Thatcher’s great strength was that she did not particularly care about being popular — for which, let us not forget, she was rewarded with three election victories. And taking on the status quo is going to make the government unpopular. But David Cameron is no Mrs. Thatcher. The prime minister is not the man to stand up and say what needs to be said. He is still racked with guilt for his privilege and afflicted by that vacuous and peculiarly British concept of “One Nation” conservatism, which seeks to compromise between liberty and safety, and which has largely accepted the post-war settlement as being the foundation of a “civilized” society, despite mounting evidence to the contrary.

Still, we can hope.