Wednesday, November 25, 2009

THE SHOEBOX

A man and woman had been married for more than 60 years. They had shared everything.. They had talked about everything. They had kept no secrets from each other except that the little Old woman had a shoe box in the top of her closet that she had cautioned her husband never to open or ask her about.

For all of these years, he had never thought about the box, but one day the little old woman got very sick and the doctor said she would not recover.

In trying to sort out their affairs, the little old man took down the shoe box and took it to his wife's bedside. She agreed that it was time that he should know what was in the box. When he opened it, he found two crocheted dolls and a stack of money totaling $95,000.

He asked her about the contents.

'When we were to be married,' she said, ' my grandmother told me that the secret of a happy marriage was to never argue. She told me that If I ever got angry with you, I should just keep quiet and crochet a doll.'

The little old man was so moved; he had to fight back tears. Only two precious dolls were in the box. She had only been angry with him two times in all those years of living and loving. He almost burst with happiness.

'Honey,' he said, 'that explains the dolls, but what about all of this money? Where did it come from?'

'Oh,' she said, 'that's the money I made from selling the dolls.'

A Wife's Prayer:
Dear Lord,
I pray for Wisdom to understand my man;
I pray for Love to forgive him;
And I pray for Patience for his moods;
Because Lord, if I pray for Strength,
I'll beat him to death.

Thursday, September 10, 2009

Obama lies about his health care plan to sell it

I got to hear a good deal of Obama's health care speech last night, much to my wife's disapproval. She especially disliked when I started shouting back at him after he commented on how little his plan would cost (only $900 billion). He said that cost was on par with wasteful spending like on the Iraq War or tax cuts for the rich. It was the "tax cuts" line that set me off. "It's my money! It's not the government's money that they can choose to give back to us! Why should I bother earning it if it belongs to them!" (with lots of salty f-bombs tossed in for emphasis).

The scare tactics line bugged me, too. He very obliquely tells us we're all liars and that he will "call out" those who misrepresent the plan. I am not accustomed to being threatened by my President. Is that bullying threat not meant to scare us into silence?

This man has no connection to American ideals. He believes gov't has the right to control us (and, most of all, determine how much of our money we get to keep). He will allow us to keep our doctors. Really? Is that his option? He could have chosen not to allow us to keep our doctors, but he is being nice to us? Where in the Constitution does it give him the power to determine which doctor I will see or which insurance company I will use? Nowhere! You would think a requirement to defending the Constitution, as per his oath, would be the reading the thing and understand how it limits Federal gov't power.

I don't believe his cost estimates. I don't believe him when he says the plan will be entirely paid for by spending cuts (yeah, right -- and he's also not going to raise taxes on the non-rich). I don't believe that the gov't plan will not be subsidized, nor that the final goal is not a takeover of all health care in America.

He says we need a gov't plan because the for-profit insurance companies will always have too much of an incentive to rip people off. He does not mention that:

  • There are already not-for-profit medical insurance companies -- if they are not "keeping the insurance companies honest", why would his insurance plan do so?

  • The profit motive provides an incentive for efficiency, since inefficiency diminishes profit -- without the profit motive, inefficiency swells (as can be documented in Medicaid and Medicare and just about every gov't enterprise) as well as fraud and corruption (Fannie? Freddie?).

No, he did not mention these things. Does he think we're too stupid to know it? Of course he does, who are we kidding?
Insurance executives don't do this because they are bad people. They do it because it's profitable. As one former insurance executive testified before Congress, insurance companies are not only encouraged to find reasons to drop the seriously ill; they are rewarded for it. All of this is in service of meeting what this former executive called "Wall Street's relentless profit expectations."
What is that if not a declaration of war on profits. Do you know what prolonged the Depression more than anything else? FDR's relentless war on profits. When he stopped battling American manufacturers and enlisted them (for profit) in the war effort, the country finally rebounded. War on profit => Depression.

He complains that 75% of the insured are insured by just 5 companies. Well 70% of all cars sold in America are made by 5 companies. 40 years ago, 3 companies dominated the American market. The shift away from the big 3 automakers was not forced on us by gov't -- the market shifted because of the voluntary choices made by individuals. Did we need a gov't automaker? Don't answer that, Obama. We know your answer.

There was a time when 90% of all PCs were made by IBM. Did that change because of a gov't sponsored PC plan? Industry dominators Microsoft and Intel are losing market share. Is this because of a secret gov't plan? Still, Microsoft and Intel dominate their rivals. Is this a bad thing? Do we need a Federal department of computing to rectify this situation?

So why do we need gov't to increase competition in a market that has thousands of companies and is dominated by no less than five major companies?

He pretends to be mortified that almost 90% of insurance in Alabama is sold by only one company. But it's a free market in Alabama (I hope). They can choose any of the competing companies (if the state let's them). If 90% choose the same company, good for them and good for that company. Why exactly is that bad? A gov't run alternative is not necessary, nor necessarily better.

He says:
...the public insurance option would have to be self-sufficient and rely on the premiums it collects. But by avoiding some of the overhead that gets eaten up at private companies by profits, excessive administrative costs and executive salaries, it could provide a good deal for consumers.
He wants us to believe that this gov't program would be efficient -- more efficient than the privately run alternatives. That would be a first in history.

Then there's this beaut:
It would also keep pressure on private insurers to keep their policies affordable and treat their customers better, the same way public colleges and universities provide additional choice and competition to students without in any way inhibiting a vibrant system of private colleges and universities.
Why are public universities cheaper than private? Why is that, do you suppose? It's because they are heavily subsidized by the taxpayer! Who writes his speeches, kindergartners? They are as thin as tissue paper and about as intellectually heavy.

He claims, "It's worth noting that a strong majority of Americans still favor a public insurance option of the sort I've proposed tonight." That cannot be true. I think that is a load of horse hockey. I doubt it is a majority, much less a strong majority. The last poll I saw showed a majority did not trust him to solve the health care problems, much less support any particular private option.

He is the liar-in-chief, as Thomas Sowell points out. He is attempting to rush this through, even though it will not take effect until after the next Presidential election, because he knows if we see it before it passes we would not buy into it.

Wednesday, July 29, 2009

Lincoln: Protector of states rights

Many today long for a President and Congress who would respect the rights of each state and its people to control what goes on inside the state. They require their state legislatures to assert protection against Federal legal incursions that have come in the form of state mandates, gun control, heavy taxation and now a body of health care constraints so burdensome that they comprise a form of servitude to the state. I was wrongly taught that Lincoln was a Destroyer of states rights, but in fact he held a respect for them incomparable to any President in our lifetime.

Lincoln's First Inaugural Address focuses on the issue of states rights. There are a number of interesting passages in it, including this excerpt from the 1860 Republican platform:

Resolved, That the maintenance inviolate of the rights of the States, and especially the right of each State to order and control its own domestic institutions according to its own judgment exclusively, is essential to that balance of power on which the perfection and endurance of our political fabric depend"


Lincoln believed he was constrained to respect state laws, and he explicitly states in the address that this included the right to own slaves where it was then legal and the duty of all states to return fugitive slaves. He explicitly denied any intention to forcibly abolish slavery in any state. Of course, he wished to abolish slavery and was elated at that certain prospect shortly before his death, but he wished it abolished by majority vote, not force.

What I find quaint is his naive belief that the Federal gov't would remain constrained. As we all well know, those who comprise all branches of our Federal gov't no longer exercise such constraint. Consider these two passages (again from his First Inaugural):

Think, if you can, of a single instance in which a plainly written provision of the Constitution has ever been denied. If by the mere force of numbers, a majority should deprive a minority of any clearly written constitutional right, it might, in a moral point of view, justify revolution -- certainly would, if such right were a vital one. But such is not our case. All the vital rights of minorities, and of individuals, are so plainly assured to them, by affirmations and negations, guaranties and prohibitions, in the Constitution, that controversies never arise concerning them.

By the frame of the government under which we live, this same people have wisely given their public servants but little power for mischief; and have, with equal wisdom, provided for the return of that little to their own hands at very short intervals.


Can anyone today earnestly state that the Federal gov't holds "but little power for mischief"? Does that describe our current situation of massive bailouts; phony, crony "stimulus" packages; ubiquitous and oppressive carbon taxes; and now the looming health care slavery? This government intends to deny us the vital right to make decisions about how we care for our health and that of our loved ones, while a bare majority stand by and cheer. They respect no "guaranties and prohibitions". Apparently, some do not even feel the need to read the text of the laws they pass!

Lincoln would not recognize the Union he preserved. But he would remind us of the duty we have, come the end of the "short interval" in 2010 when we have a chance to put an end to the power to make mischief; that in so doing we free ourselves from the reimposition of slavery masked as free health care. A revolution at the polls, I expect nothing less. The first shots have been fired this Spring. The next rumble will take place on September 12 in Washington. These are but precursors to the quake in November 2010.

Tuesday, July 28, 2009

I wish I had calibrated my words differently

"I wish I had calibrated my words differently", said Obama, after saying that the police "acted stupidly" by arresting someone who had let his ego overcome his common sense.

Obama misuses his words about as often as his predecessor, but because he choose Latinate words, and because the watchers of his words tend to be enamored of his style, they fail to properly parse what he actually says. The word calibrate was wrong. One calibrates measuring instruments. One precisely adjusts tools and machines so that they work properly. That is calibration.

To some of us, words mean what they mean and not what we wish them to mean. We use them to express ourselves, albeit sometimes with less precision than we'd like. But to others, words are meant to be twisted and meaning is meant to be distorted for personal advantage.

Am I the only one who finds this abhorrent? I think not. I hope not. The low esteem in which journalists, lawyers and salesmen often find themselves, is testament to the unpopularity of twisting words. "Weasels" we will say, recalling an animal with uncanny skill at bending and twisting its very body to elude capture.

Obama might have said, "I wish I had chosen my words differently" (which is probably what he meant to say, but hoped to sound more intelligent by using the longer, Latin word "calibrated"). He could have said, "I wish I had calibrated my meaning differently", as he could have used words to adjust his meaning or to express a slightly different intention.

Or he could have said, "I wish I had phrased it differently", "I misspoke", or "I spoke rashly", or "I spoke before talking to the cop", or "I wrongly assumed the world would be interested in my ignorant opinion on this or any other trivial matter."

But he didn't. He looks at words as malleable in meaning and devised to calibrate our perception of him. This is canny in a politician or anyone else whose primary job is to manipulate people. However, a statesman is concerned first about the effect of his actions and secondarily about his words. This is why many of us admire W despite his infamous malaprops. It is why we often hear the word "Trumanesque", but never the word "Eisenhowerian" (or hear the word "Clintonian" to mean one who thinks he can spin his way out of anything).

It is why some of us watch plain-spoken Sarah Palin and rejoice. It is why thousands of intellectuals look at her and wince. She lacks polish, but she seems to speak from her heart and that is a welcome change, and quite a contrast to her President.

Tuesday, June 09, 2009

Cutting muscle

Yesterday my company had a round of layoffs. Everything in this post is public knowledge except for my feelings about the people who were let go. I have removed all references to the company itself, per company policy.


This is the third round they have had since I started working there. In the first round, they got rid of dead wood amongst the permanent employees and kept most of the contractors (including me, at the time). I was new to the company and did not know the people who were fired.

In the second round, they cut the weak performers, people who were making a contribution, but whose work was non-essential or whose salary was high compared to their output or who were otherwise deemed expendable. They also cut most of the contractors. I knew several of those people who were good workers.

In the third round, they have cut some people who were indisputably making a genuine contribution, including two members of my team of eight and some managers who had been at the company a long time. Everyone acknowledges that as these people walk out the door, essential operating knowledge leaves with them. The cuts may be justified and unavoidable (and essentially protect the jobs of those of us lucky enough to still have a job), but they were brutal. We still need those people, we just cannot afford them. Brutal decisions like this are what keep companies alive in hard times.

If before they had been cutting fat, today they cut muscle. They just sold off part of the company. The argument is that, with that part out of the way, we will have less work to do and hence, we will need fewer workers. The reality is that, for the next several months, we will have more work to do in transition, we will have longer nights. But we will have the satisfaction of knowing we are helping to keep the company going.

The company's majority investor, has invested hundreds of millions in the company since February. This sale brings in $millions and once the sale is complete those stores will no longer be bleeding cash from our company. I am confident that these steps will bring the company back.

I have no way to judge the worth of our product: I am not a woman and have no taste in clothes besides. I have to trust the talent of those who know the industry and know their customers. I do not know all of the things upper management is doing to make this company profitable again, and some of what I do know I should probably keep to myself. They have replaced a key person with a more talented person. They have streamlined operations and are working to make things more efficient. We are exploiting free, open-source software to make ourselves more productive. The people who are running this company are doing a very good job in a difficult time.

I am surprised that I still have a job. I will not survive the next round. I hope there is no next round, but there is another financial reporting period before the Christmas season and the survival of this company depends on our customers coming back to the stores to spend.

But when I look at the economy and the direction of the country, I am not optimistic. The unemployment trend is atrocious and could have been predicted. Some of this could be blamed on the frightening collapse of financial companies, but some of it is also to be blamed on those who for more than a year did their damnedest to convince the American people they were suffering from the worst economy since the Depression last year: Obama and Hillary, chiefly. Well, now they have their wish, and it is up to them to fix the problem.

Clearly, what they are trying is not working, and let's face it, it never had any prayer of working. If they had wanted to give American industry a shot in the arm, they could have forgiven in taxes an amount equal to the inaptly named "stimulus" plan. How many jobs would have been saved?

They could have put a moratorium on various gov't regulations (e.g. Sarbanes/Oxley) which cost tens of thousands of jobs annually. That would be a stroke of the pen and real jobs saved -- not just phantom jobs as Obama claims to have saved without offering any evidence whatsoever. As many people have pointed out, the gov't does not measure jobs saved, so where does Obama get his numbers, if he is not making them up? He's making them up.

They could have borrowed this year's payroll tax revenue and let the people keep that extra money. People cannot spend what they do not have. Instead, they borrowed and printed the money, but have given it to banks who are not lending it. Even if banks want to lend it, they depend on the borrowers' confidence to repay, a confidence that is clearly absent nowadays.

Before he was elected, I predicted that Obama would be known as Carter 2.0, but now I fear he will take a place beside Hoover. Nothing he promised has come to be except for the thing he droned all last summer: This is the worst economy since the Depression.

Sunday, May 17, 2009

The need for federalism

Some say we should outlaw unfunded or partially funded mandates, with the naive hope that the burden of funding the implementation would make the federal gov't more responsive to the taxpayers. I hope it is clear now that there is bipartisan support in Washington for irresponsible borrowing and little aversion to taxation.

However, when it comes to taxation: They should never take this much of our money without getting better agreement from the people before doing it. The magnitude of the sums they will shortly require of us, call for significant deliberation and debate.

But Congress repeatedly ignores us. They specialize in the cramdown. They've very nearly lost sight of all principle.

There is no antidote to this other than to take back the power due to us at the state and local level. Let us decide. Let the federal government back away. We do not like having our money taken from us with the promise that somehow it'll all be best for everybody sometime down the road. Depriving the public of open deliberations leaves us with only vague promises that Father Law knows best. Where is our skepticism?

They continue to promise us a retirement and medical care when we get old, but all the actuaries tell us that these retirement and medicare funds are unfunded. It is not prudent to depend upon such an insecure system. And yet we do.

Those who have so carelessly abandoned the sound financial future of this country and its currency are not to be trusted with bigger responsibility. And yet they are intent on seizing control of the medical care community, an area most of think requires a very high degree of local control. How can the left tolerate such interference given that had nationwide laws prevailed prior to Roe v Wade they would have prohibited abortion at a time when states like New York had legalized it?

Are we to accept federal control over where your doctor can cut and how deeply? We need to let some states disagree with each other and tolerate the diversity. This is how the gay marriage issue is being decided today. The states don't all agree. That's federalism.

Nationalized health care is the most dramatic grab of Federal power in nearly 100 years.

Is it too much to ask that our Congressmen read and understand, and logically argue about the laws they pass before they pass them? The Obama "stimulus" package was no more debated, much less read, up front than was the Patriot Act. Both required careful consideration before passing. We were cheated of that debate. And even if 100% of all these bills were to survive intact after significant debate, we would still be richer for having hashed it out in public.

But we don't do that.

Friday, March 20, 2009

What's the difference between Obama and Jesus?

Stop me if you've heard this one...

What's the difference between Obama and Jesus?

One thinks he's the Messiah, the other was a carpenter who could assemble a cabinet.

It is pretty astounding that Obama has not yet filled all the openings in his cabinet. He was supposed to be the uber-competent President, but clearly is inexperienced and not a good judge of governing talent.

He is a good judge of political talent. He spins a good spin. He is great at getting people to feel enthusiasm. He makes a good campaigner.

Too bad he was elected to govern.

At this time in his Presidency, Bush had filled his cabinet. And remember that Bush had 41% less time to prepare to be President because of the Florida recount. Obama does not have all the top spots filled and still has most of the lower level Treasury spots to fill (which one would think would be the highest priority spots to fill).


Also, Bush had to deal with a Democratic majority in the Senate (thanks to the non-entity from Vermont who switched parties). Obama has a lopsided majority in the Senate from his own party who would confirm anybody (even tax cheats like the Treasury Sec'y).

But then none of this really surprises those of us who warned against Obama. Does anybody really think McCain would be at a loss finding people to run the gov't? Does anybody think that if he'd appointed Phil Gramm we would be two months into the Presidency without a plan to right the economy? Does anybody suspect that a conservative Treasury Sec'y would advocate huge deficits and sanction the Federal Reserve creating $1.2 Trillion out of thin air (as the Fed did yesterday).

People are griping (rightly) about the $165 million in AIG bonuses, but $1.2 Trillion of insta-cash is a huge pile. To put it in perspective, you'd be pretty ripped if somebody misspent $1,000 of your mone. $165 million is to $1.2 Trillion as $1,000 is to $7.28 million.

Hello Mr. Inflation, how long do you intend to stay in the United States?

I used to think of Obama as Carter 2.0, but now I am confident that people will eventually stop comparing Obama to Jimmy Carter out of respect for Jimmy Carter.

Tuesday, March 17, 2009

Asking others to pay for themselves is not immoral

Eugene Robinson wrote, "The way we ration health care now -- according to the individual's ability to pay -- is immoral", and he goes on to advocate higher taxes to pay for the uninsured.

First of all, it is an exaggeration to say that such health care is rationed because some cannot pay for it. Rationing is a system whereby one's access to a good or service is controlled despite one's ability to pay, not because of it.

There is nothing immoral about letting one's ability to pay determine whether one gets health care. I would argue that it is morally hazardous to make others pay for all, while some escape payment altogether. Today, 40% of Americans pay no federal income tax at all. Are we now to give them a free ride on all their health care costs as well, while placing a higher burden on others (some of whom are struggling as well)?

We already pay for the health care of the indigent. I balk at paying for the health care of those who merely wish to pay less than health care actually costs. Many people forgo health care insurance despite the fact that they can afford it because they prefer to pay for cell phones, manicures, private school, etc. Health care is essential, these others are not. They choose not to pay for health care insurance because it is very expensive. This is irresponsible. I don't like that it is expensive, but I know that paying out of pocket is even more expensive. One must prepare for the worst and hope for the best -- or take responsiblity for one's gamble.

If Eugene Robinson wants to help those who fall into the gap between medicaid and affordable health care, I urge him to spend his time and money supporting a charity that will help such people. Some exist. If they are not to his liking, he should start one of his own.

However, to demand that I contribute to his charity is theft. To make gov't tax collectors force me to contribute to his charity only makes it legal theft -- it does not change what it is.

When I was poor, I depended on charity and was grateful for it. I pay the gift forward. That is the proper response. To suggest that the gov't do my work for me would be laziness.

I see two problems with gov't run health care insurance:
  • It eliminates the incentive to spend health care dollars wisely. Even though my company pays for less than half of my premium, as a payer, I remain motivated to keep health care costs down so as to keep next year's premium reasonably priced. Participants in a guaranteed health care system who themselves pay little tax to begin with, have no such incentive. It would soon make health care much, much more expensive than today. Unless taxpayer funded health care maintains an incentive to use health care wisely (and counting on the good behavior of others is folly) then the system will not work. We cannot hope to insulate people from the costs of living. We must encourage people to take part in hoisting the burden, not attempt to shift it from them.
  • Because we have a progressive tax system, most people would end up getting a discount on their health care insurance. Those who pay no federal tax would get free health care and have no idea who was paying their bills for them. They would be unlikely to recognize the gift, but would come to expect it as an entitlement. It is one thing to provide health care insurance to people in the gap, it is folly to provide it at a discount and make others pay far more than their fair share. It encourages irresponsiblity. Charity is fine, but reckless charity damages the recipient by discouraging self-care, lowering self-esteem and cementing dependence.
I have never seen a proposal for taxpayer funded health care that addresses these concerns. I am waiting.

Why I believe in the death penalty

When I contemplate what this man did to his own daughter and grandchildren, I have the urge to bring an end to his breathing (after due process of law).

The Pope is off his rocker

Speaking in Africa today, Pope Benedict XVI said that the distribution of condoms is not the answer in the fight against AIDS in Africa. "You can't resolve it with the distribution of condoms. On the contrary, it increases the problem."

This is factually incorrect. Condoms may not entirely eliminate the problem of AIDS, but the fact is that unprotected sex is the major vector for the disease and condoms almost entirely shut down that vector (except that they can break or be used incorrectly).

What if the Pope were to say, "You cannot resolve the problem of germs with antiseptics. On the contrary, it increases the problem." Would you then insist that surgeons stop scrubbing before operations? that hospitals stop using alcohol, iodine and betadine?

The Catholic church has made a fetish of opposition to contraception. I will grant that human life begins at conception. That is a scientific fact. It does not follow that all conceptions must be protected against safe abortion, but it is impossible to argue that once sperm hits the egg it is anything other than a human being. I am sympathetic to those who wish to protect such innocent lives, even though I do not entirely agree with the position.

But to argue against preventing such human life is a step too far. It makes no sense, especially if one believes that human life should be protected from the moment of conception. The fact is that preventing conception also prevents the subsequent abortion of that human being. To the hypothetical person in question, the matter is moot whether she is conceived and killed or never conceived at all. But to most of us on this side of the womb, the distinction is considerable. Most of the eggs that erupt from a woman's ovaries are shed without conception. What is true for women's eggs is many orders of magnitude truer of sperm.

It is hard to argue the value of any of them until they are united -- not brought within close reach of one another -- united as one genetic whole. Nature does not value them. Nature does not even value fertilized eggs unless they manage to implant themselves in a receptive womb. Many fertilized eggs are spontaneously aborted. What value then do they have before they even come into being?

Leave aside that argument and assign some value to potential, preconceived human life for the sake of argument. Does such life then take priority over adult human beings? That is what the Pope is arguing -- that the use of condoms is worse than protected sex. He says, despite the obvious scientific contradiction, that they make the problem of AIDS worse. This is completely irresponsible.

Yet because of this fetish against contraception, the Pope is unwittingly (or perhaps disingenuously) encouraging unprotected sex. One cannot dispute that abstinence is the perfect contraception and prophylactic, when practiced without failure. But to suppose that abstinence is going to be successfully practiced in a majority of cases, much less 100% of the time, is to ignore the fact that human copulation has been popular for millions of years prior to the Christian Era -- popular since the species first emerged, in point of fact. To argue in favor of abstinence only is to guarantee conception will occur and disease will be spread. This, in turn, leads to at least some abortions, some unwanted births and some very unfortunate deaths from AIDS.

Just as environmentalists who oppose a dam must take responsibility for any deaths that result from a subsequent uncontrolled flood, the Pope and his fellow fetishists must take responsibility for the abortions and AIDS deaths that result from the unprotected sex that will inevitably occur amongst those they teach to avoid condoms.

Tuesday, February 10, 2009

Unintended consequences

My uncle was an engineer maintaining the facilities at Ohio University. He built a little suspension bridge to connect the campus to the golf course. They had no budget, so he scrounged together parts and they built the bridge for about $500 in the 1960s. It was replaced 30+ years later by a bridge that cost about $500,000 -- 1000 times more. Your gov't spenders at work.

But my uncle's bridge was not built far enough over the river. They figured that if the water came up more than four feet, no one was going to go golfing anyway. One winter day, the bridge started catching the ice that was floating down the river, turning it into more of dam than a bridge. It's hard to think of every contingency when designing something. That's true even of something as simple as a 150 foot suspension bridge.

They watched as the water backed up behind the accumulating ice. What to do? One fellow suggested that maybe they could use dynamite to break it up. That seemed a bit dangerous, so they decided to go to breakfast and talk about it.

An hour or so later, they returned to the bridge to find that the water had risen while they were at breakfast and pushed the ice chunks over the bridge and downriver. Problem solved.

Sometimes the best thing to do is nothing at all. Have a nice breakfast.

Thursday, February 05, 2009

The velocity of money

I got a letter from a relative who says that she does not want to buy from companies like Nike because they exploit their workers. There seems to be a bit of a contradiction in what she said, in that she said she doesn't care about these people but she does not want to buy anything made by slaves or children or sweatshop workers (presumably because such work exploits them). Let us leave aside the notion that these people work voluntarily under such conditions in order to avoid worse conditions, that what is seen as a miserable existence to us is a step up for them from an even more miserable existence. I am focusing on this paradox: that she seems to care more about punishing those who make a profit from these people then she does about the people they are supposedly exploiting.

As for jingoism, my father's father ran for Congress in the 1930s and his number one issue was to preserve American jobs by raising tariffs. This was the accepted Republican doctrine of the day, a contrast to today's Republicans who tend to support free trade. Economists agreed then as now that raising tariffs was one of Hoover's big mistakes (another mistake was raising taxes quite a bit in a slow economy, when money was already tight).

But trade barriers, like union labor barriers, look good only when you consider their effect on a subset of people. When you consider the universe of people, they don't look so good. It is true that a union raises the wages of its members, but that also limits the number of people a business can hire at that wage (assuming that the business had already determined what fraction of its budget to devote to labor costs). This means that some people who would be available and willing to work at that company, even at a lower wage, will go unemployed. Is it better for 75 people to get 100 quatloos per month or for 100 people to get 75 quatloos (a quatloo being a Star Trek unit of currency).

The union worker says, "Yeah, it's better to have only 75 workers making a higher wage because I'm amongst the lucky 75 and the other 74 are my brothers and sisters in the union." The poor, unemployed schmucks on the outside have a different opinion. It is obvious they will never agree. But theirs is not the only consideration. Presumably, a group of 100 employees are more productive than a group of 75. All other things being equal, they are 33% more productive and produce 33% higher profit. A company with 33% more profit can afford to either hire more workers (if the market warrants it) or pay higher wages to its workers in order to secure its productive labor force in a competitive market. Or it might not expend the additional profit in labor, but might invest it in equipment. In this case, the benefit spills out of the company and into the coffers of its vendors. Conversely, when that profit is not earned as in our example where the company is restricted to 75 workers, this hurts not only the 25 workers who did not get hired today, but the various vendors who did not sell their wares.

Lowering labor costs is just one of many ways of boosting productivity, but higher productivity is good for society. It is what grows the economy. There was a time when people feared that automation would put people out of work and eventually only the employed elite would be able to survive (the rest, presumably, would have starved). In retrospect, we see that this did not happen. Not only do workers have a higher standard of living than 100 years ago, but we work fewer hours to make that living (and live longer).

As workers, we would prefer that productivity be increased through other means than having our wages cut, but the economic forces have no preference. I am not arguing that unions do not have the right to agitate for higher wages, and I certainly understand the reason for it. It's just that the effect of unions is higher wages and the effect of higher wages is also lower productivity and less than optimal economic growth.

The same principle undergirds trade barriers and union labor barriers: Both restrict the flow of capital. The union constrains capital to be spent on a less productive workforce. Trade barriers constrain capital to be spent on more expensive goods, presumably made by less productive workers. This depresses the economy by keeping money from getting re-spent. If I have to buy more expensive American-made goods, I might run out of budgeted money in the first store, so I never get to the next store to buy something from them. When money is concentrated with one entity, the more likely it is to be saved instead of spent.

Going back to my simplistic union example, the union shop supports 75 spenders and the non-union shop supports 100 spenders. Just as a sieve with 100 holes lose water faster than an equal-sized sieve with 75 holes, a community with 1,000,000 spenders spends money faster than a similar community with 750,000 spenders.

Economists speak of the velocity of money, which measures the rate at which the same dollar gets re-spent. They call this measure the M1 money multiplier. You can see what happened to the velocity of money this fall in this chart. It depicts a historic drop-off in the velocity of money. It would seem to me that the last thing you would want to do at this time is decrease the number of spenders in the global economy by restricting the flow of capital.

This is not just theory, either. America tried protectionism in the 1930s, the very sort of protectionism my grandfather espoused. We see where that got us.

Friday, January 23, 2009

Dancez

I just rewatched the video for "The Safety Dance", a video from 1982. There's a word whispered by a breathless woman in the background before the first chorus. I never understood what she was saying. It's not repeated in the song. I had to look up the lyrics. It's voiced by a rather attractive blonde in the video.



I also ran across this homage to "The Safety Dance" from the TV comedy scrubs. Clever how they worked that in.

Baby boomer Obama

My brother just wrote an email suggesting that Obama was not a baby boomer and that he will distinguish himself from his predecessors because he is of Generation X, not a selfish baby boomer. Well, Obama is technically a baby boomer, if you believe that hooey. I think astrology is more useful as an indicator of human behavior. What sign is he?

[I have an old girlfriend who just told me she is Aquarius with Scorpio rising. Well, she certainly made this Scorpio rise, but that had more to do with her birthday suit than her birthday.]

Anyone who looks at Bill Klinton and George W. Bush and sees them as alike because of their relative nearness in age is not a serious onlooker of history.

And if we're going to use hyphenated prefixes to describe Obama's particular flavor of American, then let's not stop at African. We must describe him as half-African-American. I don't know what the other half is and it does not seem to matter to most people. Even though the African parent spent less than a day with him after he had left Obama's mother, and it was his non-African mother and grandparents who raised him, his father's line gets top billing. How patrimonial!

We bother to distinguish between French and Italian and Irish and German Americans (although we do rightly tend to lump English, Scots and Welsh into the group British-Americans). We don't call all white people Euro-Americans. No one would mistake a Russian accent for a Mexican one (although we probably would not pick up Alsatian as Robert Redford does at the end of "Three Days of the Condor" when he confronts hit man Max Von Sydow). And yet we are to believe that all Africans are the same; Kenyans, Tunisians, Hutu and Tutsi They seem to distinguish each other somehow, sometimes cleaving the difference with a machete, but they all look alike to us (except those descendants of Boers, like Teresa Heinz Kerry; she's white! How dare she call herself African-American just because she actually came to America from South Africa).

I remember my niece excitedly talking about the international students at her college and how some of them were African-Americans (not blacks and not Africans -- "African-Americans from other countries!"). Look, if we really intend to remark upon a person because of the color of his skin, and I see no reason to, let's refer then to his skin color and not the continent where some of his descendants came from. And let's be more accurate about it. Barack and Michelle are not the same color, and neither is black.

I am not impressed with Barack Obama. He voted present more often than not in his short and undistinguished career. When and if he actually does something, I shall judge him on that basis and not on his relative age or skin color.

As for his wife, she received a $195K raise after her husband became a US Senator, probably solely because of his new position. Obama obliged by granting her employer $millions in earmarks. She went on to spend most of her time on the campaign trail and could not have done much real work for them as "VP of community affairs". Not a problem, she had already done her job (or I should say, Barack did it for her) by securing the money. Her raise in pay was a kickback. Nice kickback. Perfectly legal, too. And it turns out that, now that she has moved on to Washington and resigned her position, the hospital has decided that it really does not need a "VP of community affairs" after all and is not going to replace her, not even with someone willing to work for less than $317K.

With her, I'm impressed, but not in a nice way -- and I think it has nothing to do with her skin color, nor her relative age.

But these are our overlords. They live by their own rules. They are better than us, or they think they are. Obama's pick for Treasury Sec'y used to work at the International Monetary Fund -- what better qualifications for overlord? He had to be reminded by the IRS to pay his self-employment taxes (Social Security and Medicare) for 2003 and 2004. And he did pay them... late. Even though the IMF had promptly reimbursed him for those payments, making him sign a paper promising to use the money to pay his taxes -- he forgot somehow and pocketed the money. This is the guy we want in charge of the Federal fisc? A guy who forgets what money was supposed to go where? A guy who thinks paying his taxes is optional? This is the guy we want solving the Social Security crisis, a guy who forgets that Social Security is funded by taxes?

And, after the IRS reminded him of his 2003 and 2004 obligations, did he go back and pay his 2001 and 2002 obligations? He did not. Those were beyond the statute of limitations. He still owed the taxes, but could not be legally compelled to pay them. So he didn't (even though, he had been reimbursed by the IMF and signed the same notice saying that he understood what the reimbursements were for). He has paid them now, of course. Paid them while he was being vetted for the Treasury job. But would he have paid them otherwise? What reason do we have to believe he would? Under oath, speaking to Congress, he refused to answer the question. Well, at least he had the decency not to lie under oath. That's a step up from past Democratic administrations.

Shouldn't the same rules apply to all? And shouldn't the rules apply more strictly to those who seek to administer them?

But have no fear, Obama has signed a paper saying that he expects his administration to uphold high ethical standards. Of course, that is probably just lip service to soothe those who need such soothing, who hear words and feel no need to watch to see if actions match. He said the right thing. That's what matters, right?

And so, Obama promises to go beyond partisanship -- this after he trashed the previous administration and the opposition party in order to get elected. Oh yeah. The Congressional Republicans probably won't remember any of that. And they're mostly old baby boomers anyway.

Saturday, January 17, 2009

We Are the Ones Who Are No Longer Waiting for Ourselves

They sent out a memo at work saying "We recognize that Inauguration Day is going to be a historic day, but we caution against watching the event on streaming video. Thank you for respecting our bandwidth issues".

Had they been on the ball, they would have set up a video feed in the largest conference room and played the inauguration on big screen TV. I guess that's only for official executive use, though.

Not that I would be watching at that historic noon. I'll be in the bathroom retching.

Chris Matthews, whose leg tingles when Obama speaks, does not feel that way about Bush. After Bush's farewell address, he claimed that Bush was responsible for 100,000 deaths in Iraq. If that is the case, then FDR and Truman were responsible for the deaths of tens of millions (including 6 million Jews). Doesn't that get things backward? Is there not at least some intellectual rigor left amongst the media (not at MS-NBC, apparently). Most of the deaths in the Iraq War were caused by the insurgents. They planted the IEDs and they were the suicide bombers. They blew up the mosques and marketplaces. It was not coalition forces killing these people.

That's not to say that no innocents were killed, but anyone who understands the concept of a just war realizes that innocents may be killed. One cannot fight a just war if one is afraid of dying oneself, nor if one is afraid of accidentally or inadvertently killing the wrong person (including killing one's co-warriors in friendly fire). Of course one strives not to make these mistakes, but one cannot remain paralyzed in fear of making them.

Nonetheless, it was not by coalition forces that the majority of such innocents perished. It was at the hand of the enemy that they perished. It is calumny to suggest that it is Bush's fault. And it is blindness to fail to realize that Iraq is far better off today than under Saddam Hussein. Moreover, Saddam was a murderous bastard in his own right, a prolific killer who would have killed and tortured almost as many as the nearly vanquished enemy unleashed by his capture.

But these people are blind to true suffering. Obama will be responsible for more than 100,000 deaths in his first year in office if he fulfills his promises to reverse Bush's anti-abortion policies, such as funding for the UN's family planning agency, which helps fund forced abortions in China and China's one-child policy -- don't let anyone tell you they're pro-choice when in fact these people are pro-abortion, even when it is not the choice of the mother. Ironically,many of the aborted babies are female since Chinese prefer males, thus the feminists support the death of future women.

This is just one of the reasons I'll be quelling my nausea on Inauguration Day.