By John Seiler

Apple Inc. is the world’s most profitable and admired company. It’s also the world’s biggest tax dodger. Reported the Wall Street Journal of a U.S. Senate grilling of CEO Tim Cook, “The Senate panel, in a report released Monday, said that Apple used technicalities in Irish and U.S. law to pay little or no corporate taxes on $74 billion over the past four years.”

Good for Apple. No reason to get robbed more than necessary. This also explains how Apple thrives in California’s notoriously high-tax environment: they dodge paying much of the extortion.

And who has most benefited your life in recent years? Apple, with its great inventions? Or the government, with its confiscations and abuses?

But it’s a little hypocritical of Apple because its wealthy executives are part of Silicon Valley’s Democratic Party political culture. The late Steve Jobs, who devised the tax-dodging strategy, was a Democrat and friend of President Obama.

There are no studies to prove it, but I would suspect that most top Apple execs are Democrats who voted for Proposition 30, last year’s $7 billion tax increase. It supposedly taxed those who had to “pay their fair share,” as went the phrase of Gov. Jerry Brown (and of President Obama on the federal tax increases imposed by him and Republicans on Jan. 1).

But those who are supposed to “pay their fair share” are richer, smarter and better connected than the rest of us, and so can run rings around the politicians and activists who write the tax laws, and the government functionaries who implement the laws.

Here was a typical exchange at the hearing:

Sen. Carl Levin (D., Mich.), chairman of the investigations panel, on Tuesday accused Apple of employing “alchemy” and “ghost companies” to escape tax collectors in the U.S. and Ireland, the base of the firm’s international operations outside the Americas.

“Apple has sought the Holy Grail of tax avoidance,” said Mr. Levin. “Apple is exploiting an absurdity, one that we have not seen other companies use.”

Mr. Cook [Apple CEO] countered: “There’s no shifting going on…We pay all the taxes we owe, every single dollar.”

Levin is retiring next year after a long career of misgovernance, wasting the taxpayers’ money with a wild abandon. Levin also pressured the IRS to go on its since-revealed witch hunt of conservative and libertarian groups, although now he’s pretending to be the taxpayers’ friend against such abuse.

It’s not just him. Both Republicans and Democrats refuse to reform the confiscatory policies and socialist spending that all but mandate the IRS abuse.

Someday, we’ll repeal the demonic income tax — and replace it with nothing.

By Chris Reed

Will 2013 be the year that unionized faculty members at UC, CSU and the state’s community colleges finally figure out the threat that online education poses to their futures? If it is not this year, it is coming sometime soon. The same dynamics that have killed Borders, Tower Records and travel agencies, made newspapers far less lucrative and shaken up dozens of industries — easy, free/cheap online access to content and information — threaten bricks-and-mortar higher education.

“Look at the music industry. It’s been completely overturned by the Internet. My vision of the world is that everywhere will be like the music industry, but we’ve only seen it in a few places so far. Journalism is in the midst of the battle. And higher education is probably next,” is how George Mason University economist Tyler Cowen, an online education visionary, puts it.

Yes, K-12 is likely to live on in its present form because of the role schools play in the socialization process. Yes, Ivy League universities will continue to serve in their role as de facto gatekeepers for entry into Wall Street and high finance. But in Silicon Valley, the value that is placed on traditional credentials in most of the U.S. isn’t nearly as consistently strong. It is understood that learning can happen lots of ways, and hardly just in a formal classroom. Steve Jobs, Bill Gates, Mark Zuckerberg? All college dropouts. This is not lost on the rest of California’s elites.

Jerry Brown on the bandwagon

Now more and more online education is free, and the power of education apps on iPads and other devices is becoming more obvious, and people have realized how much great educational content there is on YouTube. At the very least, we seem sure to move toward a model in which online learning is a big part of traditional education because of its efficiency and low cost.

And guess who agrees this is a great idea?

“Quoting poet Robert Frost on the benefits of innovative thinking, Gov. Jerry Brown said Tuesday that three unusual math classes offered this spring at San Jose State University hold out hope for resolving one of California’s most troublesome problems: overcrowded classes.

“‘Online is part of the solution,’ Brown told a roomful of educators at San Jose State before quoting from a 1939 essay in which Frost said, ‘Originality and initiative are what I ask for my country.’

“Although online courses have been part of college curricula for years, the three new ones – at $150 each — suggest a new and possibly cheaper direction for students, California State University and Silicon Valley.”

But when will unions figure out that convenient and inexpensive inevitably eventually means fewer well-paying jobs? When will unions figure out that the U.S. student-loan debacle also feeds the crisis atmosphere around the old bricks-and-mortar norm?

For reasons I can’t comprehend, none of this has sunk in. The UC faculty associations, the CSU faculty union and the California Community Colleges faculty union don’t seem to grasp that if good and improving higher education is free or dirt-cheap online, if a conventional degree loses its gatekeeper status in many jobs, and if huge student loan defaults keep making headlines, the status quo could wither quickly.

Cowen and many other educators, economists, philanthropists and futurists have been writing about online education for years, especially its disruptive possibilities. By contrast, read the coverage of Jerry Brown’s push to have San Jose State and Udacity team up in offering online courses on the CSU faculty union website. It suggests that this could somehow be a good thing for faculty:

“CFA President Lil Taiz agrees on the importance of asking questions about student success:

“She said, ‘It’s good the CSU is actually testing out these methods and starting on a small scale. We must find out which online tools work well (or not), for what kinds of students, and for what kinds of subject matter. There is a lot to unpack in the pedagogy.’

“CFA and CSU managers have met on how the terms of work in the first semester of the pilot accord with the faculty contract.

“’You can’t have quality learning conditions for students—online or in a classroom—without professional working conditions for the faculty. Our contract is an important piece of making sure we have fairness, equity, and quality in all aspects of CSU teaching.’”

Clueless and oblivious in the faculty lounge

Wow. The lessons of recent history don’t appear to have sunk in at all with UC, CSU and CCC faculty if profs think online education’s arrival and increasing acceptance bodes well for them.

When Jerry Brown talks about the need for UC, CSU and CCC to be more efficient, he may not be talking only about pushing students to graduate in as little time as possible and not dawdle on campus. He may actually want them to become more efficient in the way other information businesses have become efficient — by taking full advantage of technology.

When will we see this trigger the modern equivalent of a Luddite reaction?

Soon, I suspect. When the liberal governor of California’s enthusiasm for online learning sinks in, the Lil Taizes of the Golden State will have no choice but to think about its long-term implications.

By John Seiler

Why do young nerds angling to be the next Steve Jobs still flock to Silicon Valley? That’s where Mark Zuckerberg transplanted Facebook, which he started in his Harvard dorm room. Facebook’s IPO this week pegs its value at around $100 billion.

But the Facebook owners are being gouged by the bankrupt state of California for $2 billion. If they had moved instead to Austin, Tex., or Seattle, Wash., they would have paid no state income or capital gains taxes. If they had moved to the Cayman Islands, Singapore or another tax haven and renounced their citizenship — as co-founder Eduardo Saverin has done — they could have avoided even most of the 35 percent U.S. income tax and 15 percent capital gains tax.

California also has numerous preposterous laws people and companies must follow, from banning the use of cell phones in cars to banning smoking almost everywhere. Well, I suppose the young gearheads don’t smoke — cigarattes, anyway.

My theory is that Silicon Valley is like Star City was in the old Soviet Union. If you were a budding young cosmonaut aspirant in the Soviet bloc, that was the place to be. According to Wikipedia,

“Cosmonauts of the Russian Federal Space Agency, and the Soviet space program before it, have lived and trained in Star City since the 1960s. In the Soviet era the location was a highly secret and guarded military installation, access to which was severely restricted.”

There was no question of defecting to the West. Sure, you maybe could escape across the border and be given asylum in the United States. The FBI would debrief you about your knowledge of the Soviet space program. You’d be given a new identity as Ivan Smithsky in Dubuque. You’d be a free person. But no way they’d let you become an American astronaut.

So you were stuck in Star City. The amenities there made it worthwhile. Unlike the subsistence living scraped out by most Soviets in the workers’ paradise, you would be given the best food and drink, a decent apartment or house, culture and entertainment, even access to banned literature the Soviet bosses winked at. They knew you weren’t going anywhere. You also had to put up with pervasive secrecy and being spied on.

The weather? Much better in Silicon Valley, of course. No Russian winters. But if you were a Russian wanting to be a cosmonaut, you grew up with the winters. And if you stuck with the program, retirement would be in the Crimea, with California-style weather and great local wines.

People will do almost anything to get what they want. They’ll put up with socialism, whether the Soviet or California kind.

That’s why Silicon Valley will continue attracting high-IQ future Jobses and Zuckerbergs. For as long as anyone reading this is alive.

For most of the rest of us, it’s Moscow circa 1970, Jerry Brown as Leonid Brezhnev, but with great weather.

Katy Grimes reported here at CalWatchDog.com on the protests against cuts in aid to college students. That means higher tuition — “fees” — to attend state colleges and universities.

Here’s an idea for how kids can cut the costs of going to college: Don’t go.

It’s a myth that going to college always leads to higher pay. Sometimes it does. If you want to be a doctor or lawyer, there’s no choice but to go to school for the better part of a decade.

But a degree in sociology or psychology or English is almost worthless. You end up with debt totaling maybe $50,000 and have wasted four years taking pointless classes between smoking reefers when you could have spent those precious years starting a career or a business — or getting married and having kids. And let’s face it, after Social Security and Medicare go broke, the only retirement security most people will have in 20 years or so will be their kids.

Do college people generally make more money? Yes, but that’s because they’re smarter in general. And smart people, in general, make more money. If the smart kids had skipped college, they’d still be smart at whatever else they did.

Look at Bill Gates and the late Steve Jobs. They dropped out to start computer companies now worth hundreds of billions of dollars. Would they have done better if they had gotten degrees in postmodern poststructuralism posteverything studies?

The Altucher Plan

One of my favorite bloggers is James Altucher. He’s written a couple of times against college. He has a new blog up about it, “Did Obama Really Say He Wants Everyone to Go to College?” He writes:

“There’s a weird debate happening out there. Apparently Rick Santorum “accused” Obama of insisting that every child go to college. Other websites have said that Obama has never said this but instead has encouraged every kid to seek a higher education. I don’t care about Obama or Santorum. I don’t care about politics at all. But it’s interesting to me how this issue has again sparked a debate.

“Expect lots of lies and cutting and stabbing for the next few months until the election. Santorum clearly lied. Obama lies. Everyone will lie about everyone else. Which is why I hate politics, why I think Congress should be abolished, and why I think Nobody should be voted in as President.”

You can see why I like this guy.

“And now suddenly, and sadly, ‘to go or not to go’ to college has become a political issue. Yet another pressure trying to ruin the lives of our children.

“Then a friend of mine, Kathryn Schulz, the author of the book ‘Being Wrong’ suggested that I am the ONLY person who thinks kids should not go to college. This is clearly not true: Peter Thiel and Seth Godin being some examples and there are many examples of successful people in the arts and business who did not go to college.”

Put me on the list.

Six Reasons

Altucher lists six more reasons not to go to college. A couple of them:

“over the past 40 years, college tuitions have gone up 10 times faster than inflation and three times faster than healthcare costs. Healthcare costs is an ongoing national debate. Why aren’t tuitions? Why should we force our 18 year olds now to take on so much debt. Its three times as high now as when I graduated college and I graduated with about $70k in debt that I had to pay back….

“Many will say it’s about learning. However, the tools for learning are so much more advanced now (because of the Internet) that there are cheaper, more effective solutions for education than ever before. And yet, more than ever, kids feel coerced into going to college.”

Right. The Internet provides all you need to learn something. For example, the Khan Academy provides, free, the best math course going, as well as numerous other free courses. He has more than 3,000 videos up — with thousands more to come.

“Does anyone learn anything in college? Let me ask you a couple of quick questions. At some point you came across these facts in either college or high school. See if you can answer quickly and correctly without looking it up. They are very simple: When was Charlemagne born? Name the different types of clouds? Who was William Mckinley’s Vice-President?”

OK. How’d you do, without looking anything up? My answers: I remember Charlemagne died in 814, but can’t remember the date of his birth. My guess: 750. Turns out it’s around 742. I think I learned that in high school. Clouds: I remember cumulous, but forget the rest. I learned that in 8th Grade Earth Sciences with Mr. Smith. That was in 1968 back before Earth Sciences became politically correct Global Warming Humans Are Evil Sciences. Here’s a list of clouds.

McKinley’s VP: Teddy Roosevelt. I probably read that on my own when I was maybe 10.

See? College is worthless.

“a college education will fill your memory. Teach you a lot of facts. Maybe teach you basic analysis that conforms with your teacher’s opinions. But will NOT teach you how to really think. Will not teach you how to come up with ideas. How to sell ideas. How to be creative. How to navigate through interesting experiences so you won’t get hurt.

“Let’s not forget that high school and below are primarily advanced babysitting services. So what makes college different? You’re still with the same demographic of people. You still have homework and tests and memorization of facts. The only difference is now you (most likely) live on your own. Is college the safest environment to do that? Is that the wisest use of the highest tuition costs ever? I doubt it.

“Learn how to learn. Then go wherever in the world you want to go. Because the world will be yours then.”

I like how Altucher always ends his blogs with zingers.

Bull Sessions

One more thing. What about one of the best things about college, bull sessions with your buddies? Here’s how to take care of that. Get together at somebody’s house with some of your smartest friends. Get some Jack Daniels and some cigars (or Virginia Slims if you’re women). I won’t encourage you do do doobies, but some of you might do that anyway.

Sit around and smoke, drink and talk about philosophy, history, English, movies, books, the Internet … whatever.

Total cost: $50. Cost of college: $200,000. Your savings: $199,950.

— March 6, 2012

By WAYNE LUSVARDI

California Gov. Jerry Brown may have met his moment of infamy on a Feb 1 TV show.  He said, “California is losing manufacturing jobs at a rate no faster than the rest of the country.”

Brown’s claim is not backed up by data from the U.S. Bureau of Labor Statistics.  California lost manufacturing jobs at a higher rate than competing states.  Here are the percentage and absolute number of manufacturing job losses in competing states over the last decade:

Manufacturing Job Losses in Competing States

California lost 15 percentage points more manufacturing jobs than Nevada and 10 percentage points more than Texas.  More significantly, California lost 411,300 manufacturing jobs over the decade.  That is more than the 280,100 for Nevada, Texas, Oregon and Arizona combined.

Brown continued, “This is the place where Facebook started, where Hewlett-Packard started, where Steve Jobs built Apple Computer just a few miles from where we’re sitting. This is a place of innovation.”

But Apple and Hewlett Packard are companies that have out-sourced almost all their computer component manufacturing to China. In the 1970s, Jobs and his Apple co-founder Steve Wozniak scrounged parts for their early computers from the leftovers of HP and other manufacturing giants. They couldn’t do that nowadays unless they moved to China.

And Facebook wasn’t “started” in California. It was started at Harvard University. It only moved out here later because founder Mark Zuckerberg wanted to live and work among the top companies and geniuses of his industry. Hasn’t Brown seen “The Social Network“?

Facebook IPO

Brown mentioned Facebook because its IPO is expected to net a $500 million tax windfall for California’s coffers. But to be prosperous, a state needs to produce more than high-tech jobs for people with high IQs.

The ancient Greek philosopher Socrates once said, “Nobody is qualified to become a statesman who is entirely ignorant of the problems of wheat.”

One might say that California’s politicians cannot be ignorant of the problems of manufacturing and claim to be qualified to find solutions to unemployment.

With the value of the dollar diluted by Federal Reserve policy, California could re-capture some industries from overseas.  But what is Gov. Brown doing to bring this about?

He continues to back the Bullet Train to Nowhere. And he’s implementing AB 32, the jobs-killing Global Warming Solutions Act of 2006.

Curiously, the program Brown appeared on, “The War Room,” is hosted by Jennifer Granholm, the former Michigan governor. During her time in office, her policies emptied the Great Lake State of manufacturing jobs, as Chrysler and GM went bankrupt. No wonder she didn’t press Brown on his anti-manufacturing policies.

When it comes to manufacturing, California needs leadership, not a smooth TV conversationalist who claims to model his policies on the ancient Greek ruler Aristides.

The biggest ripoff going is textbooks for K-12 and, even worse, college. I know some college kids who spend way more than $1,000 a year for required textbooks for their college classes.

Usually the texts are sub-par regurgitations of P.C. claptrap. And the professors who write the texts “update” them every couple of years, so you can’t buy a used copy.

Enter Apple.

According to Ars Technica, “Apple announced what it’s calling ‘iBooks 2’ during its media event in New York on Thursday, a textbook software program that allows textbook-makers and instructors to create rich, interactive teaching media for the iPad. As we first reported earlier this week, the announcement is akin to ‘GarageBand for e-books,’ giving authors access to easy-to-use tools on the computer in order to create multimedia content for the iPad.”

Steve Jobs lives!

Apple says the price will be no more than $14.99 for high-school books. It’s not clear what could be charged for college texts. But it’s unlikely anyone would be dumb enough to charge the $100 or more kids get stuck with nowadays.

This also will sharply cut costs for private, parochial and home schools.

And instead of kids schlepping around heavy textbooks, they can sprint carrying their iPads, weight 1.34 lbs.

Interactive

The new iBooks also will be interactive. So instead of just reading about the Space Race of the 1950s and 1960s, students could read the text, then watch pictures of rockets taking off, such as the Apollo 11 launching; or listen to JFK’s moon shot speech.

Better yet, kids also will be able to download critiques of their textbooks. Imagine taking a sociology class and getting stuck with a textbook laden with the usual post-modern, deconstructionist, anti-Western, Marxist, anti-capitalist rubbish. But on your iPad, right next to the official text, is snarky commentary from some other student that you uploaded.

The monopoly on students’ thoughts has been broken. The cultural Marxist totalitarian Berlin Wall inside kids’ minds has been torn down.

How appropriate that, on the same day Apple announced this great new tool of liberation, Reuters reported, “Apple Inc’s quarterly results blew past Wall Street’s expectations as U.S. consumers snapped up near-record numbers of iPhones and iPads, sending its shares up 8 percent.”

The truth shall make you free. In color and with a soundtrack. With your iBooks 2.

Jan. 24, 2012