Archive for August 2009

Thought For the Day on Government Management

Via John Stossel:

On that note, economist Justin Ross points out on his blog how, for 44 cents, you could mail a letter via USPS - or buy a kiwi fruit that had to be grown and watered in New Zealand, picked, carefully packaged, and shipped across the world to a store near you.

How to Make a Libertarian Nuts

Show him this chart, via Carpe Diem


I'm Glad I Read This...

I wasn't that familiar with the California Coastal Commission.  I have toyed around with buying some property close to the beach in California to escape Arizona summers.  But once I read this article about their abuses, I have no desire to own California land along the coast.  Because, apparently, you don't actually "own" the land, at least not the way I define it.

The CCC's authority has decidedly grown since its beginnings as a temporary outfit with jurisdiction over 1,000 yards of coastline to an established agency with five miles of nearly absolute power, overriding local decisions and slapping multi-million dollar fines on people building small houses on existing concrete pads that could only be seen from the coast by a Superman with telescopic and X-ray vision.

See, for an example, the story of Kathleen Kenny, one of the stars of Oshen's documentary, now deceased. Kenny beat back local inspectors' assaults on her for building on her own property. She even in 1997 won an unprecedented RICO suit against local government officials for harassing her, a case where she acted as her own lawyer. Despite this, she was never able to shake off the CCC from coming after her for more or less the same offense. It has levied multi-million dollar fines that still hang over the head of her living partner, Arthur Starz.

Indeed, the CCC is still on the march. Even as it's compelling Oshen to kick up his footage, a bill is now being considered in the California state legislature that will give the CCC independent power to levy $5,000-$50,000 "administrative civil penalties" (in addition to any other fines or penalties) for violations of its ukases without having to get a court involved. The agency could then use that money for...more enforcement actions. Another bill would dictate that anyone with an unresolved CCC violation order over their heads could not submit an application for any other development permit from the CCC, on that land or any contiguous land.

Legalize Immigrants From Mexico; Ban Immigrants From California

Until a few years ago, I did business up and down the Pacific Coast.  If I had to rank the business climates of these states, from worst to best, I would informally come up with something like:

  1. (worst) Certain California counties (e.g. Ventura, San Francisco, Santa Barbara)
  2. Oregon
  3. Western Washington
  4. Rest of California
  5. Eastern Washington

So I was interested to see that Oregon may finally be getting the bad press it deserves as a difficult place to do business, though, interestingly enough, this particular article blames it on the Californians:

Some might call this California disease. This refers to a chronic inability to make hard decisions as well as a general disregard for business and economic activity....

With all the influx of Californians, it's not surprising that Oregon shows some signs of California disease. It recently increased its tax rates so that Oregon's highest-income taxpayers face marginal tax rates that match Hawaii's for the highest in the nation. Oregon's land-use planning had been extremely centralized for some time. Indeed, Oregon's land-use planning may be the most centralized in the United States. This makes it harder for communities to control their own destinies, whether they want to grow or not.

Interestingly, I actually wrote about similar effect in the context of immigration into the US.  While I am a supporter of open immigration, my greatest fear is that in the name of individual liberty, we would let in millions of new people who would someday vote against individual liberties.  It seems that may be a more substantial problem with Californian than Mexican immigration.

The good news for the rest of us is that Oregon may preferentially be attracting the slackers

Our analysis of California migrants has shown a gradual reduction in their earnings over what they were earning in the Golden State. There also are less quantifiable impacts. Portland, a city attractive to many unemployed and underemployed younger Californians, could well be becoming the "slacker" capital of the world.

Fortunately, Arizona is so politically un-correct with slacker/socialist/statist/greenie types that we don't get a lot coming here.

Sheriff Joe Launches Coup Against Rest of County Government

It appears that our Maricopa County government (which is the county that Phoenix is in) has risen to new levels of dysfunctionality.  Apparently our Sheriff Joe Arpaio missed his calling as South American general, launching a coup last week against the rest of the county government (for whom he supposedly works).

Maricopa County sheriff's deputies on Wednesday stormed into a county building, seized control of a computer system and threatened to arrest county employees if they tried to stop them, according to county officials.

County management responded by asking a Maricopa County Superior Court judge for a temporary restraining order against the Sheriff's Office.

The system, which provides access to law-enforcement databases, is the subject of a lawsuit between the Sheriff's Office and the Board of supervisors.

It links county computers to Department of Public Safety databases, which store criminal background information. But it also is a server and e-mail platform for several county agencies, including the Sheriff's and County Attorney's offices and the Superior Court.

Its management is the subject of a 2003 interagency agreement. But in light of recent layoffs of system operators due to budget cuts and squabbles among the agencies, the Sheriff's Office felt that sensitive data that should be the sole domain of law enforcement had become too available to the system's civilian administrators, who work for County Manager David Smith and the supervisors....

"The sheriff did not receive permission from - or give notice to - any other elected official or stakeholder agency before barging in with armed officers and demanding that he be given exclusive control," he said.

It turns out that the Sheriff's concern about protecting confidential information could well be a smokescreen.  For years, the Sheriff's office has been, unsuccessfully, attempting to gain access via the courts to records and emails from other departments, information that, coincidentally, resides on the seized servers.

Just as the Sheriff's Office is concerned about civilians' access to records, county management is concerned the Sheriff's Office now has access to information from other county agencies it is investigating, such as the Superior Court. State appellate courts have rebuffed Arpaio's attempts to obtain privileged court e-mails, which would be accessible through the system. Superior Court Judge Joseph Heilman has scheduled a hearing for today regarding the restraining order.

I'm Not That Big on National Mandates, But...

...requiring dash cameras in every police vehicle would be a great idea.  Via Radley Balko, of course, video in his post here.

I do think Ms. Harmon has her lawsuit a bit misdirected.  I don't think Tasers per se are the problem.  If this guy didn't have a Taser, it would just be a nightstick or physical force.  The issue is that many police act as if they are dictators of the local area within their line of sight.

Global Warming Alarmists Have Your Best Interests At Heart

Sent to me by a bunch of readers, from the Atlantic interview with Thomas Schelling:

I sometimes wish that we could have, over the next five or ten years, a lot of horrid things happening -- you know, like tornadoes in the Midwest and so forth -- that would get people very concerned about climate change. But I don't think that's going to happen.

This reminds me of a post from way back, when Kevin Drum wrote:

Seeking to shape legislation before Congress, three major energy trade
associations have shifted their stances and decided to back mandatory
federal curbs on carbon dioxide and other man-made emissions that could
accelerate climate change.

I responded:

Having some Washington lobbying organizations switch which side of this incredibly difficult trade off they support is not "good news."  Good news is finding out that this trade off may not be as stark as we think it is.  Good news is finding some new technology that reduces emissions and which private citizens are willing to adopt without government coercion (e.g. sheets of solar cells that can be run out of factories like carpet from Dalton, Georgia).  Or, good news is finding out that man's CO2 production has less of an effect on world climate than once thought.  Oddly enough, this latter category of good news, surely the best possible news we could get on the topic, is seldom treated as good news by global warming activists.  In fact, scientists with this message are called Holocaust deniers.

Postscript: It is particularly telling of a certain mindset that Schelling specifically wishes bad things to occur in the Midwest.   By most leftish standards, people in flyover country (except maybe Ohio since it is a key swing state) don't really count.

These Are The Folks Who Promise to Streamline Medicine

From Henry Payne:

"In apparent violation of the new cash-for-clunkers law, the Department of Transportation [DOT] is more than 10 days late in paying rebates of at least hundreds of thousands of dollars on dealer claims," reports Automotive News....

The clunkers law signed by President Obama requires that dealers be reimbursed by the government within ten days for the $3,500 to $4,500 credits they've paid to customers. The DOT says it's working through computer problems.

"Very few dealers are getting very little money," said Bob Israel, president of the Louisiana Automobile Dealers Association. "It's not working smoothly at all."

David Wilson, a Toyota dealer in Orange County, Calif., has been paid for only three of 92 claims he submitted before Aug. 2, leaving him in the lurch for $374,000.

North Carolina's Brad Wood has12 unpaid claims since Aug. 1. He's received just $26,000 of the $319,000 in rebates he is owed. "I've never experienced anxiety like this in business before," he says. "If I don't get paid, I will have been working almost free for several months."...

Many deals are also are getting rejections for procedural minutiae that they can't straighten out because the 200 employees DOT has allocated program aren't enough. Employees are inaccessible by phone or e-mail, NADA's Wood says. The problem? Unlike the IRS, for example, which doesn't audit every tax form, all clunkers applications must be reviewed. That's 315,000 forms so far (for a staff of 200). Washington is scrambling to boost the number of employees to 1,000, but that will cost more money in a program already tight for cash.

Read the whole thing.  He goes on to describe the way in which the Feds are setting up dealers as the fall guy for the Fed's failures.

Update: From Carpe Diem, on health care in Britain

1. TELEGRAPH -- A quarter of a million people are waiting more than 18 weeks for treatment on the NHS, new figures show. The figures, published by the Lib Dems, show that 236,316 people are currently waiting more than 18 weeks for a range of treatments including oral surgery, rheumatology and geriatric medicine. This means that nearly 10% of patients are not being treated within the government's waiting list target.

2. TELEGRAPH -- Civitas, the think tank, blames the monolithic nature of the National Health Service for "putting the patient last". It argues that the "customer" of the NHS business model introduced by Tony Blair and continued by Gordon Brown is the health secretary rather than the patient.

By the way, if you are intrested in free markets and economics, you really should be reading Carpe Diem. I could link almost every one of Mark Perry's posts if I had the time.

Coolest Stuff I Have Worked With In A While

Electro-Luminescent wire.


I am a little late to the game on this stuff -- apparently hobbyists have been using it for crafting.  For example, who wouldn't want a Tron outfit?

To date, I have mostly sheltered readers from the geekiest of my hobbies: model railroading  (Yeah, I know what you are saying -- how can anyone who spends hours a day at a computer writing on arcane bits of business and economics issues possibly be anything but cool?)  This may soon change, as I am starting a new N-scale layout and I will probably inflict some in-progress photos on you folks.  To get an idea just how crazy I am, I build my own track from wood strips and bundles of rail and tiny, tiny spikes -- so we are not just talking about putting the old Lionel out on a green table cloth.

Anyway, for some time I have wanted to build a layout that is primarily meant to be run in the dark as a night scene.  So I am experimenting with a lot of technologies, from florescent paint to tiny LED's to small bulbs to get ideas for various scenes.  The EL wire turns out to be a dead ringer for scaled down neon, so I expect to use a lot in the city part of the layout.

I will leave you with a photo of the layout that probably inspired more people (including myself) into the hobby than any other  -  by the master, John Allen:


If you get intrigued with his work, more photos are here.

I wish I had more pictures of my old work, but they seem to have been lost in a move.  All I have left is a few poor-quality, poorly-scanned under-construction photos of my first layout from years and years ago.



Postscript: Can a hobby be geeky if Rod Stewart shares it?  He has built an absolutely stunning layout - one photo below and more herestewart-layout

And yes, the work really is his own, he didn't just pay someone to build it for him.

Explain the Correlation...

I am confused as to why a preference for overpriced organic foods and a preference for government monopoly control of health care are necessarily correlated at the 1.0 level.  But apparently they are.  Maybe its a common desire to overpay for basic necessities?

Art Book Omits Any Pictures of Art

The producers of a book about a series of famous works of art decided unanimously that it was unnecessary to include any pictures of the works of art being discussed.

[The pictures are] freely available on the Internet and can be accurately described in words, Mr. Donatich said, so reprinting them could be interpreted easily as gratuitous.

Can you imagine this being said about a book on, say, Seurat?  Could you describe in words adequately the visual impact of Pissaro, or how it differed from Monet?  No?  Pictures are a visual medium - I would argue that they are failures if they can be adequately and completely described in words alone.

Of course, the quote above is not about an art book, it is a book from Yale University Press about the group of the 12 Mohamed cartoons drawn by that Danish cartoonist.  Someone (actually an entire publishing staff) actually thinks it is a good idea to write an entire book about a set of visual media without reproducing the visual media in the book.  Incredible

Ironically, the cartoons are freely available on the Internet ONLY because some Internet site proprietors have more intestinal fortitude than Yale.  If everyone took the same stance as Yale, they would not be freely available.  And since most of the major media made the same editorial choice not to publish the cartoons at the time of the controversy, the likelihood that a reader has not actually seen the pictures is much higher than, say, for a Seurat book.  In this sense, Yale had a greater, not a lesser, obligation to publish the cartoons in the book.

Besides, to see the cartoons is to say, "WTF is all the fuss about."  I mean they are bland, bland, bland by the scale of either American or European political cartooning.


Seriously, the only reasons someone would want to not publish these cartoons is to help hide just what an astounding over-reaction it was to make much of a fuss over them in the first place.  Seriously, these things are the Emperor's new clothes, except that  a few folks calling them out for being naked still haven't stopped a majority of the intelligentsia from continuing to pretend.

This is also ironic given the really, really low bar Yale has set for art in the past.

We Actually Have A Control Group

It is going to be a really, really, really long four or eight years if the Obama Administration and much of the left insists on declaring that anyone who dares to criticize a black President in racist.  The most recent example, of course, are frequent charges that critics of the health care reform are motivated by racism.

It is already clear that this Administration intends to raise the unverifiable claim to a new state of the art (3 million jobs saved or created!)  But the interesting thing about the health care - racism link is that in this particular case, we actually have a really good control group -- the first term of the Clinton administration.

In 1993, the Clinton administration embarked on a double secret effort to redesign the health care industry under government authority.  As details of the plan leaked out, many folks went nuts.  Commercials aired in key districts attacking various portions of the proposals and raising fears all around.  People were so ticked off that in the 1994 mid-term electi0ns, Democrats lost control of Congress for the first time in many decades, an election trouncing generally credited first and foremost to health care proposals.

Its not like the Obama administration is unaware of this example.  Many if Obama's approaches to the health care legislation this year are intentional changes from Clinton's approach.  Obama's rush to pass legislation that does not really start getting implemented until 2013 by the August 2009 recess was clearly an attempt to prevent opponents from gearing up campaigns against the bill as they did with Clinton's.

But here is the really interesting part.  I could have this wrong, but I could swear Clinton is a member of the White Anglo-Saxon Protestant oppressor race.  If so, the implication is that people went bonkers in 1993-1994 over health care plans for some political reason, but people who go bonkers  in 2009 over many of the same plan points are racist?  Does this pass any kind of smell test?

What is really going on is that a bunch of people who have never held a productive job, being politicians for life, and who have bought into their own "dedicated public servant" marketing are suddenly shocked to find that they and their efforts are not universally appreciated.  When someone has the bubble burst on their manufactured self-image, their reaction is seldom pretty.

Regulation and Choice

If you want to really confuse someone, restate the minimum wage laws this way:

It is generally illegal in the US to accept a job for less than $7.25 an hour.  The minimum wage laws are therefore a substantial constraint on individual liberties

When I say this to most folks, they get confused because laws like minimum wages are usually stated in terms of empowerment of the common man.  The theory is that individuals don't have enough bargaining power to really get what the true clearing price should be for their labor, so the government steps in to prevent evil corporations (ie "the man") from exploiting this power imbalance and paying wages that are too low.

Tell that to my 15-year-old son who is looking for a job.  Sure, he would like to earn some good cash, but the wage scale of a job is way down the list of priorities.  What he really needs is a chance to build basic work skills and knowledge of how organizations function that you and I take for granted.  Further, he would like to get some direct experience with customer contact.  And finally, he wants to demonstrate to future college choices that he can function successfully in a work environment, and that he is motivated enough to keep and hold a job.

As a result, my son would likely gladly take the right job for, say, $3 an hour.  And an employer might jump at this deal, understanding the lower wage helps compensate for the costs of dealing with an inexperienced new employee and the risk of hiring a teenaged boy with distracting amounts of hormones running through his system.  This would be a perfectly rational, consensual, everybody-wins arrangement that is absolutely illegal.  So don't tell me or my family that minimum wage laws are empowering.

The health care analog

Many very similar liberty-reducing regulations exist in the health care world, and more appear to be on the way.  One great example that is entirely similar to the minimum wage issue is minimum coverage rules.  Many states have lengthy lists of conditions that must be covered in any health insurance plan sold in that state.  From acupuncture to mental health to massages to homeopathic treatments, you can find just about every care specialty with a lobbying organization getting its services embodied in state laws as minimum requirements.

Again, supporters of such laws argue that this is empowering for consumers.  Every health care plan you can buy will have a wide array of covered services.  But, they will also all be expensive.  What if I don't want mental health coverage or acupuncture?  Why do I have to pay extra for this stuff to be covered by my policy?  I go to the doctor very, very infrequently - basically only if the condition is critical - so why is it illegal to purchase a health insurance plan that matches my health care use preferences?

Currently I pay for my own health care plan and have insurance that I consider true insurance.  It has a high deductible, and does not cover a bunch of non-critical stuff.  I have no dental coverage, and pay dental all out of pocket, as I do most routine medical expenses   I have medical insurance solely to cover catastrophic medical events that would likely be financially disastrous for me  (I do the same thing with my house and car, paying for routine maintenance with insurance reserved for catastrophes).   Fortunately, Arizona allows me to buy such a policy, though it does have minimum coverage rules that make the policy more expensive than it might be.  In other states, like Massachusetts, my health plan with a high deductible is illegal.  It would also be illegal under the current House and Senate versions of Obamacare.

Medical Insurance and Windshields

I do a lot of back road and highway driving, so windshield repair and replacement are things I deal with fairly frequently.  I've generally always just paid for these repairs out of pocket.   It is a field where if one shops around, there are a lot of good deals.  However, for a while I lived in a state that had a law that said all auto insurance must have windshield replacement coverage.

The effect on my behavior was dramatic.  When living there, I didn't even think about shopping around for a windshield repair.  I just had the dealer do it (surely the high cost supplier) when I had the car in for regular service.  I didn't care what the cost was, it was covered in my policy.  (Ironically, it turns out in retrospect that I should have shopped around -- because no one else in the sate cared about cost, all the windshield suppliers jacked up their prices and then competed by offering kickbacks in various forms to consumers, basically competing on how much of the insurance money they would share with the car owner.  Truly dysfunctional).

I have seen the exact same change in my behavior, but in reverse, in switching to a high deductible medical policy.  Until about 3 years ago, like most Americans, we never even thought about the cost of our medical care.  We weren't paying for it.  But now, as I pay most of our routine expenses, I am amazed at the difference.  When my son needed a CT scan, three phone calls gave us a huge variation in quoted prices.  It turns out, shopping works, even in medical care.

Postscript: I have always wondered why insurance companies didn't create some incentive for shopping.  If I were running such a company, I would be tempted to tell customers - "our reimbursement rate for CT scans in your area is X.  If you get it done for less than X, we will split the savings with you 50/50."  Though I suppose the danger is tht this could morph into a variation of the windshield kickback system.

Watch Out - Your Industry May Be Gutted Like A Trout Next

I have written before about the  demagoguing going on about "health insurance profits" and just how BS those charges are.  Here is Obama yet again:

"There have been reports just over the last couple of days of insurance companies making record profits, right now," Obama said during a prime-time news conference. "At a time when everybody's getting hammered, they're making record profits, and premiums are going up. What's the constraint on that? ... Well, part of the way is to make sure that there's some competition out there."

This follows Pelosi saying:

I'm very pleased that our Chair of our Democratic Congressional Campaign Committee and member of the leadership will be talking too about the immoral profits being made by the insurance industry and how those profits have increased in the Bush years. We all believe in the profit motive; we all want to reward success.  But having that success come at the expense of America's working families "” have that success come by withholding care, when a person becomes ill, is just not right and we're going to take this issue in a new direction.

And pundits saying even crazier stuff, including Kevin Drum (who is actually one of the saner members of the left) writing:

It means the health insurance industry is scared that we might actually do something in 2009 and they want to be seen as something other than completely obstructionist. That means only one thing: they've shown fear, and now it's time to bore in for the kill and gut them like trouts. Let's get to it.

Rick Perry links to several posts debunking this claim, and shows a profit margin consistent with what I have found in my research -- about 3.3% of revenues, which my posts (linked above) showed has fallen over the last several years.  This profitability level ranks 86th(!) on the list of American industries, behind such rapacious industries as auto parts wholesalers and confectioners (see table in his post).  Look out everyone, if this industry is too profitable for this administration, then just about every industry in the country is too profitable.  Heck, this margin is even worse than mine, and I operate in an industry universally described as having "thin margins."

What do you call a man who thinks a 3.3% profit margin is too high?  How about "Marxist."

Update: My guess is that there is some health insurer who due to a merger grew larger and therefore made a higher profit in absolute dollar terms, so my guess is that Obama is not flat out lying.  But he is freaking close, given that he credits such profits to fee increases and denying services rather than business growth.  Profitability should be judged on margins, not total dollars (even better, it really should be judged on return on equity or return on assets employed, but that is rocket science to the economic monkeys wielding bone tools we have in the media).

Cash for Clunkers: $416 Per Ton of CO2 Reduction

Christopher R. Knittel of UC Davis has  a paper (pdf)  looking at likely CO2 reductions from cash-for-clunkers under a variety of assumptions.  The $416 figure per ton of CO2 avoided may actually be low, as it does not include the well-documented rebound effect of people with higher MPG cars driving more miles**.  Also, he admittedly assumes that cars being turned in will have average future driving miles for a car of similar age, though there is anecdotal evidence that in fact the cars being turned in are driven less than average.   Under these assumptions, the cost may be as high as $600-$1000 per ton.

The analysis looks pretty thoughtful, with the proviso (which the author is the first to make) that data on the program and cars bought/turned-in is still sketchy.  The interesting part was that there were no reasonable assumptions that even got the price within an order of magnitude of the $28 per ton clearing price the CBO estimates under cap-and-trade.

As a CO2 reduction program, this is the equivalent of the military's $700 toilet seats.  But of course we all know that no one ever really considered this an environmental or even stimulus bill.   This was always first and foremost 1) another Easter egg subsidy for the middle class and 2) a back door way to subsidize GM and Chrysler to try to make the Administration's investment in them look better.

** This is straight supply and demand -- reduce the cost of miles driven, and people will drive more miles.

More Liquor License Woes

Apparently after 20 months of effort, I am within spitting distance of getting one of two liquor licenses I am applying for in Ventura County, California (the other had to be completely restarted due to some paperwork mistakes).

I had to just laugh at the last remaining hurdle.  A part of the licensing process is to post a public notice at the site.  The ABC called me and said they are holding my application until they get my affidavit of posting -- this is a one page form with my signature stating on what date the facility was posted.

But here is the funny part -- the ABC representative who is calling me actually posted the site herself.  She visited the facility as part of a mandated inspection and then posted the site.  The only way I knew what date the site was posted was by asking her.  So ABC is requiring that I submit a form to tell them what day they themselves posted the site, a date I had to get from them before I could put it on the form to send back to them.

Coming soon:  The Affidavit of Elevated Body Temperature and/or Vomiting that must be submitted before obtaining a doctor's appointment.

I Wondered Why They Weren't Pounding the US

Usually an article like this would blame the US:

Global carbon dioxide emissions in 2008 rose 1.94 percent year-on-year to 31.5 billion tonnes, German renewable energy industry institute IWR said on Monday, based on official information and its own research.

Several other leftish / alarmist sites picked up the story, but still didn't hammer the US, saying only that the US is the largest contributor to total emissions but not whether it contributed significantly to last year's rise.  It turns out there is a reason for this.  US emissions were actually way down, falling far faster than the drop in economic growth:  (from the EIA)


The story tries to put a positive spin on Europe  (again, the preferred story line is always Europe-good-America-bad):

Carbon dioxide emissions from heavy industry participating in the European Union's Emissions Trading Scheme fell 3.1 percent last year compared with 2007, the EU's executive Commission said in mid-May

This is a carefully worded cherry-picking on one sector of the economy.  I would be willing to bet almost any amount of money that the rest of Europe's economy saw less of a drop or even an increase.  Even so, the cherry-picked sector, the one subject to cap-and-trade, still underperformed the US.  Overall, US emissions have fallen since 2000 without any real regulatory program and just the normal incentives of economic efficiency at work.

The US is NOT the problem when it comes to future emissions growth.

230 MPG?

Update:  230 MPG turns out to be, as I suspected, total BS.  Make sure to check out update at bottom

Apparently under new methodology, the Chevy Volt got an MPG rating of 230.

we're told that the Volt has snagged a staggering 230 MPG rating in the city, but we should caution you that it's not as cut and dry as GM would have you believe. The EPA has released "a new methodology for determining a draft fuel economy standard for extended-range EVs like the Volt," and it's that murky measurement system that has blessed Chevy's wonder child with a triple digit MPG rating.


Forget for the fact that the whole terminology is meaningless, as the vehicle only burns liquid fuel for a portion of its energy needs, so "miles per gallon" is an odd concept.  But one could imagine that one could look at the miles per electrical charge, and then look at the equivalent gallons of gasoline-equivalent BTU's it took to deliver that electricity, and create an equivalent MPG.  In fact, that's the only approach that makes any sense to me.

If so, these numbers imply that it is 10x more efficient to burn hydrocarbons in a large utility plant boiler or gas turbine, convert the combustion energy to electricity, transmit that electricity hundreds of miles, charge up a set of car batteries, and then drive an electric traction motor from the batteries than it is to burn hydrocarbons directly in an internal combustion engine in the vehicle.

If this is really the case, then I have been selling electric cars short and we will all soon be buying them (I prefer the performance of an electric engine so this kind of fuel savings is just icing on the cake).  However, I have my doubts.  While certainly a large power station is much more efficient in using all the BTU's in a fuel than is an internal combustion engine, when one considers losses in the electrical generation and line losses, I find it very very hard to believe the difference is 10x.

But I am sure there is no conflict of interest here, and that it is pure coincidence that GM is owned by the same people who created the new methodology and did the testing, and given that the new methodology was created by the same people who have been pushing electric cars as a policy alternative.

Update: The 230 MPG figure is even more BS than I thought.  Apparently, MPG while running on batteries is treated as infinite!  In other words, electricity is treated as "free" and not costing anthing in terms of fuel. Check out how the math is done

When gasoline is providing the power, the Volt might get as much as 50 mpg.

But that mpg figure would not take into account that the car has already gone 40 miles with no gas at all.

So let's say the car is driven 50 miles in a day. For the first 40 miles, no gas is used and during the last 10 miles, 0.2 gallons are used. That's the equivalent of 250 miles per gallon. But, if the driver continues on to 80 miles, total fuel economy would drop to about 100 mpg. And if the driver goes 300 miles, the fuel economy would be a just 62.5 mpg.

This is entirely consistent with the bizarre way electric cars have always been treated by environmentalists and politicians, as if the electricity is free and they have no  hydrocarbon use or CO2 production.  Which is weird, since we get harangued for our incandescent light bulbs destroying the world when we plug them in but plugging in a whole car does not?

That being said, if one really wanted to move away from hydrocarbon fuels, the smart approach is probably to go with electric cars and then attack electricity generation rather than transportation.  I will feel good plugging in my car because the juice will come from a big honking zero-emissions nuclear plant.

From Nobel Laureate to Political Hack

From the AZ Republic, Paul Krugman is claiming that the administration's stimulus spending, which I don't think has even reached $100 billion of the programmed $1 trillion, has officially averted another Great Depression:

Aggressive stimulus spending by governments helped the world avoid a second Great Depression

but full economic recovery will take two years or more, Nobel Prize-winning economist Paul Krugman said Monday....

"We have managed to avoid a second Great Depression ... but full recovery is at least two years and probably more," Krugman said.

This is just a pure joke.  First, the total additional spending was tiny compared to the size of the world economy.  Second, almost none of the stimulus money has actually been spent -- even the article goes on to say that "Most of the money will flow in 2010."  So is Krugman arguing that just the notion of stimulus spending, without the actual spending, has saved us?  Third, most of the early projects were typically stupid, whatever governments could ram through their procurement processes in a short period of time.   I challenge even the most ardent Keynsian to argue this stimulus was truly structured to target underutilized resources, or whatever their theory is.  I would love to see Krugman stand up in front of a doctoral committee and justify this wild-assed supposition with actual facts and analysis.

But the even more incredible unproven (and in fact entirely non-verifiable) part of the statement was that we were even headed for a second Great Depression anyway.  Many of us from the sidelines said that this looked like a recession similar in magnitude to that of the early 1980's, and in fact that appears to be exactly what we got.  The whole "second Great Depression" meme is merely a giant straw man used first to stampeded ill-conceived spending legislation through Congress with little scrutiny and now to provide a fake alternative against which Obama and company can declare victory.   Krugman is so far in the tank, its impossible for me to even think of him as an economist any more.  The Nobel Laureate who now retails non-verifiable claims.

The fact is that this was a normal recession blown out of proportion first by the Bush and later by the Obama administration.  From the very beginning, it looked much like the recession of the early 1980's or the bank crisis of the early 1990's, and it recovered for the same reason - there are fundamental strengths in the economy.  In fact, the length of the Great Depression was in fact the aberration, caused more by FDR's wild proposals (the worst of which was the National Industrial Recovery Act) which tended to dampen the investment that normally picks up at the bottom of the cycle to take advantage of reduced asset values and input costs.

Other Assertions by Krugman

Interestingly, economist Krugman appears to think that the problem with the financial system is that people can make money in it.  Really?  Gosh, I thought people just invested billions of dollars for the warm feeling it gives them:

He said there was a need to restructure the global financial system and impose tighter regulations to avoid a repeat of the economic crisis, but expressed concern that the momentum for reforms appeared to be easing.

"We do not have the political will to do that just yet ... I suspect clever people can still make a lot of money from the financial system in the next few years," he warned.

I also thought this was funny, in the context of the recent financial mess.  He says:

"Over-reliance on self-regulation is a mistake," he said. "Global regulators should err on the side of investor protection and financial stability rather than rely on a 'buyer beware' regulatory regime."

I must say it is surprising to see Krugman saying this.    Let's think about mortgages, the primary driver of the recent financial difficulties.  In mortgages, the investor is the bank making the loan.  So is Krugman advocating for more protection of mortgage lenders and their insurers like AIG against home buyers who take their money and then don't pay them back?

Update: Oh, and TARP never bought any troubled assets, just was used to bail out a few selected politically connected companies.

66,667% Contingency Fee

Via Overlawyered:

The settlement discussed in this space July 17 "” in which lawyers nabbed more than $25 million in fees and expenses, while fewer than 100 consumers redeemed Ford coupons worth $37,500 "” was covered by the Associated Press last week, which stirred outrage in many quarters [Krauss/PoL, Greenfield, Cal Biz Lit]. As Cal Civil Justice notes, the settlement was purportedly on behalf of owners who suffered no rollover or other mishap. Instead, it sought damages for losses in the vehicle's resale value due to adverse publicity, a nicely circular theory, since the adverse publicity was in good measure propelled by various allies of the plaintiff's bar.

Shame On Executives For Flying Private Jets...

...only those of us in Congress get to fly private jets

Congress plans to spend $550 million to buy eight jets, a substantial upgrade to the fleet used by federal officials at a time when lawmakers have criticized the use of corporate jets by companies receiving taxpayer funds.

The purchases will help accommodate growing travel demand by congressional officials. The planes augment a fleet of about two dozen passenger jets maintained by the Air Force for lawmakers, administration officials and military chiefs to fly on government trips in the U.S. and abroad.

The congressional shopping list goes beyond what the Air Force had initially requested as part of its annual appropriations. The Pentagon sought to buy one Gulfstream V and one business-class equivalent of a Boeing 737 to replace aging planes. The Defense Department also asked to buy two additional 737s that were being leased.

Lawmakers in the House last week added funds to buy those planes, and plus funds to buy an additional two 737s and two Gulfstream V planes. The purchases must still be approved by the Senate. The Air Force version of the Gulfstream V each costs $66 million, according to the Department of Defense, and the 737s cost about $70 million.

Even the richest of private companies blush at the prospect of buying Gulfstream V jets, the absolute top of the line in business jet luxury.  Except, of course, for the ridiculously oversized Boeing Business Jet, of which Congress appears to be buying 3 (the BBJ is the business version of the 737).  I am sure there is one, but I can't think of a single Fortune 500 company, and I have worked for and with a lot of them and flown on their jets, that has even one BBJ.

I can understand why certain officials need to fly private planes just for security, but the average Congressman from Wyoming?  Why won't commercial work.  Andy why, if they must have  a private plane, wouldn't a more reasonably sized Falcon 50 or Citation work just as well?

Update: Several people have found it ironic that the White House threw a fit over $300+ million for funding of new warplanes but hasn't blinked over $500+ million to ferry Congress around in luxury.

Update #2: An example of the BBJ.  This is how you fly, right?


Our Opposition Party Sucks

Doesn't anyone speak for sanity any more?

Washington runs on political leverage, and at the current moment few people have more of it than Chuck Grassley. President Obama is desperate to have the Iowa Republican sign on to some version of ObamaCare to give cover to jittery Democrats. So in a remarkable noncoincidence, the Obama Administration decided to roll over last week on one of Mr. Grassley's major concerns: ethanol.

OK, we will give in to your ridiculous use of government power if you will accept our ridiculous use of government power.   Lots more on the complete waste of money and time that is corn-based ethanol here.

Cost of Insurance "Reform"

To some extent, there are signs Obama may be willing to walk back health care "reform" to just insurance "reform," though the two are highly related.  As a minimum, insurance "reform" is likely to include rules that no one can be denied coverage, community rating, and minimum covered service requirements.

These are really, really expensive.  Megan McArdle on the NY experience:

John Cole takes me to task for not knowing that health insurance premia have tripled in New York State.  Indeed, he's right--I should have checked.

But this is not the "gotcha" the left believes.  I erred so low because I was trying to be charitable to the cause of national health care.  You see, the reason that insurance premia are so high in New York State is that New York State enjoys community rating, guaranteed issue, and a very generous bevy of mandatory services.  The result is that the cost of insurance is very, very high.  What I failed to realize was just how radically out of line New York's rules had pushed its health care costs.  The average premium across the United States has increased about 25% since 2004.  In New York, the rate of inflation has apparently been about 16 times that.  I wasn't "aware" that insurance premiums have doubled and tripled over the last seven years, because for the country as a whole, this isn't true.

McArdle is sometimes irritating in bending over backwards to be fair to folks whose views don't deserve such charity and who would not ever extend the same favor back at her.  So it is kind of fun to see her going a bit postal over the last few days.

Paging Frédéric Bastiat

The US Forest Service is using a million dollars of its stimulus money to ... fix broken windows! How appropriate.  But these are not any broken windows -- these are energy inefficient windows for a visitor center that was closed two years ago and for which no budget exists now or in the future to reopen.   Beyond the nuttiness of building a multi-million dollar visitor center, then closing it only a few years after it was built, and then spending a million dollars on its abandoned carcass, no one was available to explain how energy efficient windows will save money in a building that shouldn't be using any energy any more.  Remember, for this spending to truly be stimulative, the money has to be spent more productively than it would have been in whatever private hands it was in before the government took it.

But even forget the stimulus question and just consider the issue of resource allocation.   I work on or near US Forest Service lands in many parts of the country, and know that their infrastructure is falling apart.  Congress loves to appropriate money for new facilities (like shiny new visitor centers), but never wants to appropriate money for capital maintenance and replacements of existing facilities.  So there are plenty of needs for an injection of $274 million in capital improvement money.  And I know that the USFS has had teams of people working for 6 months on their highest priorities.  And after all that work, they allocated  almost a half percent of their funds on upgrading windows in an abandoned building?

Postscript: I have vowed not to write about the US Forest Service because I interact with them so much and such interactions would not be improved by my dissing on them online [I am in the business of privitizing the mangement of public recreation and am constantly working to convince the USFS and other recreation providers to entrust more to private companies.  One thing many people don't know -- the USFS is by far the largest public recreation provider in the world, far larger than the National Park Service or the largest state park systems].  However, I feel on safe ground here, as I think virtually every frontline USFS employee I know would agree with this post and be equally angry.  In recreation at least, this is an organization that begs and pleads to get a few table scraps left over after the National Park Service is done eating, and it is crazy that they spend the few scraps they get this poorly.

Reading the Health Care Bill

Here are some notes on the health care bill from one person who plowed all the way through it.  Some of the interpretations are a bit over the top, but I find it a useful index to help me find relevent sections I want to read in more detail.