Posts tagged ‘Europe’

Boy Is This Election Is Going to Suck

It is nothing new for politicians and the powerful to despise commerce and "traders."  In Medieval society, and continuing in Europe right up into the 19th century, the ruling elite scorned careers that involved actual productive effort.  If you were actually producing something, rather than indolently feeding yourself off the work of the masses, you were not a "gentleman."

It appears that this attitude is coming back in vogue, most notably from the presidential candidates of both parties.  From David Boaz in the WSJ:

Sen. Obama told the students that "our individual
salvation depends on collective salvation." He disparaged students who
want to "take your diploma, walk off this stage, and chase only after
the big house and the nice suits and all the other things that our
money culture says you should buy."

The people Mr. Obama is sneering at are the ones who
built America "“ the traders and entrepreneurs and manufacturers who
gave us railroads and airplanes, housing and appliances, steam engines,
electricity, telephones, computers and Starbucks. Ignored here is the
work most Americans do, the work that gives us food, clothing, shelter
and increasing comfort. It's an attitude you would expect from a
Democrat.

Or this year's Republican nominee. John McCain also
denounces "self-indulgence" and insists that Americans serve "a
national purpose that is greater than our individual interests." During
a Republican debate at the Reagan Library on May 3, 2007, Sen. McCain
derided Mitt Romney's leadership ability, saying, "I led . . . out of
patriotism, not for profit." Challenged on his statement, Mr. McCain
elaborated that Mr. Romney "managed companies, and he bought, and he
sold, and sometimes people lost their jobs. That's the nature of that
business." He could have been channeling Barack Obama.

Mr. Boaz mentions the hypocrisy of Obama having a million dollar house and being famous for his beautiful suits, and then telling graduates not to aspire for the same things.  But a bigger hypocrisy, or perhaps contradiction, is the fact that the candidates must know that the world won't function if everyone were to take their advice.  While bashing the productive, each relies on the productive to fund his plans.  While urging everyone to be parasites, they must know that some must ignore their advice to become the productive hosts on which the parasites feed.

But hypocrisy is not the biggest issue. The real issue
is that Messrs. Obama and McCain are telling us Americans that our
normal lives are not good enough, that pursuing our own happiness is
"self-indulgence," that building a business is "chasing after our money
culture," that working to provide a better life for our families is a
"narrow concern."

They're wrong. Every human life counts. Your life
counts. You have a right to live it as you choose, to follow your
bliss. You have a right to seek satisfaction in accomplishment. And if
you chase after the almighty dollar, you just might find that you are
led, as if by an invisible hand, to do things that improve the lives of
others.

Will Hillary Sue the US Congress?

Hillary apparently wants to sue OPEC for not producing enough oil. If this idea had come in via the constituent mail, Hillary's staffers would probably have laughed themselves silly, but it is an election year, and no bottom has been found below which candidates are unable to keep a straight face while uttering what they know to be nonsense.

But should Hillary be suing OPEC, or the US?  Because if you ranked the world's countries on those that are doing the least to develop the most promising potential oil deposits, the US would be right at the top of that list.  By Hillary's logic, Western Europe and Japan should be suing us.

Nozone

Progressives Hate The Poor

Yeah, I know they seem to care so much, but nearly every policy they actively advocate turns out to be a disaster for the poor.  Here is a great example:

In May 2002, in the midst of a severe food shortage in sub-Saharan
Africa, the government of Zimbabwe turned away 10,000 tons of corn from
the World Food Program (WFP). The WFP then diverted the food to other
countries, including Zambia, where 2.5 million people were in need. The
Zambian government locked away the corn, banned its distribution, and
stopped another shipment on its way to the country. "Simply because my
people are hungry," President Levy Mwanawasa later said, "is no
justification to give them poison."

The corn came from farms in the United States, where most corn
produced"”and consumed"”comes from seeds that have been engineered to
resist some pests, and thus qualifies as genetically modified.
Throughout the 90s, genetically modified foods were seen as holding
promise for the farmers of Africa, so long as multinationals would
invest in developing superior African crops rather than extend the
technology only to the rich. When Zambia and Zimbabwe turned away food
aid, simmering controversy over the crops themselves brimmed over and
seeped into almost every African state. Cast as toxic to humans,
destructive to the environment, and part of a corporate plot to
immiserate the poor, cutting edge farming technology is most feared
where it is most needed.

This is simply awful, and is driven by progressive politics in Europe that abhor GM food, despite reams of scientific evidence and years of experience that it has no demonstrable health effect.  (It is particularly ironic that GM corn should be the target, since corn as we know it is a man-made genetically modified food, albeit by the slow process of cross-breeding.  The very existence of corn is one of the great triumphs of pre-Columbian agriculture.)

A key element of progressive politics is to apply western middle class perspectives to Third World problems.  In this case, Europeans who are wealthy and well-fed have time and capacity to worry about problems at the margin, such as "might GM corn somehow have a negative health effect on one in a million people?"  I believe this concern is absurd even at the margin in western society, but it becomes criminally insane when applied to countries beset with abject poverty and starvation.  So we would rather let a million people starve than have one person face some hypothetical health risk?

This same approach can be seen in a myriad of other instances.  For example, progressive wish to prevent Nike from building factories in the Third World that hire locals for fifty cents a day.  Again, the middle class western perspective:  I would never take a job that paid $5 a day for ten hours of labor, so they should not either.  But this is in countries where more than half of the population makes less than $1 a day performing subsistence farming for perhaps 12-14 hours a day, and even then risk starvation when the crop fails.  The Nike factory represents incredible salvation for many.  Do we all hope they will do even better economically in the future?  Sure, but you can't step from unskilled subsistence farming for a dollar a day to middle manager at GE all in one step.

And then there is climate.  The climate change hysteria, and the associated calls for reductions 80% or higher in CO2 output, is the greatest threat to the world's poor that has existed since the bubonic plague.  And yes, I mean the hysteria, not climate change itself.  Because if the world gets warmer because of man's CO2  (an iffy proposition), the poor might or might not be worse off.  After all, it was during warm periods of the past that the poor thrived, such as the population boom in Europe during the Medieval warm period.  But if the world's governments agree to shut down fossil fuel production and reduce the size of economies, over a billion people who are set to emerge from poverty over the next few decades will instead be doomed to remain poor.  Progressive environmentalists are not even subtle about what they want -- they are seeking a poorer, lower-tech worldThey are selling poverty.

Brendan O'Neil writes in this vein:

In these various scandalous schemes,
we can glimpse the iron fist that lurks within environmentalism's green
velvet glove. "˜Cutting back carbon emissions' is the goal to which
virtually every Western politician, celebrity and youthful activist has
committed himself. Yet for the poorest people around the world,
"˜reducing carbon output' means saying no to machinery and instead
getting your family to do hard physical labour, or it involves
collecting cow dung and burning it in an eco-stove in order to keep
yourself warm.... Carbon-offsetting companies have encouraged Kenyans
to use dung-powered generators and Indians to replace kerosene lamps
with solar-powered lamps, while carbon-offsetting tree-planting
projects in Guatemala, Ecuador and Uganda have reportedly disrupted
local communities' water supplies, led to the eviction of thousands of
villagers from their land, and cheated local people of their promised
income for the upkeep of these Western conscience-salving trees....

Carbon
offsetting is not some cowboy activity, or an aberration, or a
distraction from "˜true environmentalist goals' - rather it expresses
the very essence of environmentalism. In its project of transforming
vast swathes of the developing world into guilt-massaging zones for
comfortable Westerners, where trees are planted or farmers' work is
made tougher and more time-consuming in order to offset the activities
of Americans and Europeans, carbon offsetting perfectly captures both
the narcissistic and anti-development underpinnings of the politics of
environmentalism. Where traditional imperialism conquered poor nations
in order to exploit their labour and resources, today's global
environmentalist consensus is increasingly using the Third World as a
place in which to work out the West's moral hang-ups....

Carbon-offsetting also shines a light on the dangerously anti-development sentiment in environmentalism....

In the near term, countries are already using global warming as an excuse for protectionism, and in particular are cutting off imports from poorer countries that are trying to make some economic progress:

There is little
that angers me more than disingenuous attempts to employ "˜global
warming' as an argument against trade, especially against trade from
the developing world. More often than not, blatant self-interest - that
is, old-fashioned protectionism by another name -  is being masked
beneath self-righteous, middle-class gobbledygook.               

               

Such a case is brilliantly exposed today by Dominic Lawson writing in The Independent ["˜Food
miles are just a form of protectionism. Middle-class neurosis is being
exploited to protect an archaic form of agriculture'
(April 1)]:

               

"Was
Prince Charles' chum Patrick Holden, director of the Soil Association,
expecting the Kenyan High Commissioner to fall to his knees in
gratitude? It rather sounded like it yesterday morning, when the two of
them met in a BBC radio studio.

               

They
were there to discuss the Soil Association's proposals to discriminate
against the "˜organic food' which is air freighted into this country,
mostly from East Africa. "˜One option was to ban it altogether,'
declared Mr Holden, but instead he and his colleagues had decided that
such food would only be banned if it was "˜not produced ethically' -
whatever that means....

"On the whole it
is a "˜lifestyle choice' limited to middle-class mothers in the
South-east of England who are neurotic enough to believe the
insinuations of the Soil Association that little Henry and Caroline are
more likely to get cancer if mummy doesn't buy organic (at twice the
price).    
Now
another largely middle-class neurosis - we are all doomed unless
everybody stops flying! - is being exploited to protect an archaic form
of agriculture which could never feed this country, still less the
world. It
is, at best, an exercise in self-delusion. At worst, it is a way of
using food as the instrument of a deliberate policy of racial
discrimination
."

Maxed Out Mamma has more on the global warming excuse for protectionism:

I am genuinely concerned
that environmental concerns are being used as a proxy for protectionist
economic legislation and may have severe consequences. I would like to
discuss this article from a Canadian source about carbon taxation:

Imposing
carbon tariffs on emerging economies with low manufacturing costs and
high greenhouse gas emissions could drive some manufacturers back to
Western countries
, according to two economists.

Jeff
Rubin, chief strategist and economist at CIBC World Markets, thinks
such tariffs could emerge quickly. Countries in Europe are already
becoming publicly intolerant of emissions elsewhere and the next
president of the United States is expected to institute a cap on
greenhouse gas emissions alongside the trading of carbon credits.

...Europe is in an extremely
protectionist mood, and I believe one of the reasons for the
non-scientifically based focus on carbon is that it serves as a
justification for tariffs. If the next president does institute carbon
tariffs, the result will have a real impact on world trade.

I
believe that many politicians are being deeply dishonest about their
"environmental" concerns. I also believe that instituting a carbon
tariff will cause Asian growth to slow remarkably and further
destabilize the world economy. The rise in food prices is very
dangerous because it has an impact on the ability of emerging market
countries to support consumption increases necessary to rebalance
trade. If you add to the situation by doing something like this, you
could recreate the conditions which caused the Great Depression.

Immigration and Welfare

Well, I should be skiing right this moment, but my son woke up barfing this morning, making it a perfect 15 of the last 15 family trips where one of my kids has gotten sick. 

But the ski lodge is nice, and the wireless works great, and Q&O has a very interesting post on immigration and welfare.

High unemployment among immigrants is of course not confined to just
Sweden or Scandinavia. Throughout Europe, governments have found that
well-intentioned social insurance policies can lead to lasting welfare
dependence, especially among immigrants. Belgium is the European
country with the highest difference in employment rates between the
foreign-born and natives. The images of burning cars in the suburbs of
Paris that were broadcast around the world illustrate the kind of
social and economic problems France is facing with its restive
immigrant population.

Given the high barriers to entry, many
immigrants in Europe no longer start accumulating essential language
and labor market skills. This is in stark contrast with the situation
across the Atlantic. For example, in 2000, Iranians in the U.S. had a
family income that was 42% above the U.S. average. The income of
Iranian immigrants in Sweden, however, was 39% below the country's
average.

Lots of interesting stuff there.  Which reminds me of something I wrote years ago:

In the 1930's, and continuing to this day, something changed
radically in the theory of government in this country that would cause
immigration to be severely limited and that would lead to much of the
current immigration debate.  With the New Deal, and later with the
Great Society and many other intervening pieces of legislation, we
began creating what I call non-right rights.  These newly described
"rights" were different from the ones I enumerated above.  Rather than
existing prior to government, and requiring at most the protection of
government, these new rights sprang forth from the government itself
and could only exist in the context of having a government.  These
non-right rights have multiplied throughout the years, and include
things like the "right" to a minimum wage, to health care, to a
pension, to education, to leisure time, to paid family leave, to
affordable housing, to public transportation, to cheap gasoline, etc.
etc. ad infinitum....

These non-right rights all share one thing in common:  They require
the coercive power of the government to work.  They require that the
government take the product of one person's labor and give it to
someone else.  They require that the government force individuals to
make decisions in certain ways that they might not have of their own
free will. 

And since these non-right rights spring form and depend on
government, suddenly citizenship matters in the provision of these
rights.  The government already bankrupts itself trying to provide all
these non-right rights to its citizens  -- just as a practical matter,
it can't afford to provide them to an unlimited number of new
entrants.  It was as if for 150 years we had been running a very
successful party, attracting more and more guests each year.  The party
had a cash bar, so everyone had to pay their own way, and some people
had to go home thirsty but most had a good time.  Then, suddenly, for
whatever reasons, the long-time party guests decided they didn't like
the cash bar and banned it, making all drinks free.  But they quickly
learned that they had to lock the front doors, because they couldn't
afford to give free drinks to everyone who showed up.  After a while,
with the door locked and all the same people at the party, the whole
thing suddenly got kind of dull.

Government as Price-Maker vs. Taker

Megan McArdle makes a great point that should be absolutely uncontroversial:

government is much better as a price taker than a price maker.
Government procurement is all kinds of tedious and cluttered with red
tape, but in the end there's no gigantic problem with the government
pencil supply. Defense procurement, on the other hand, is pretty well
agreed to be godawful-expensive for what we get, the only excuse being
that we can't think of another way to buy fighter planes.

That means that government procurement alongside a free market looks a lot
different from government procurement when the government is the only
buyer. Yes, the health care market is extremely screwed up, but the
prices in it do tell you something about demand for various services,
and provide some signals about cost/benefit. You may think that viagra
is a prime example of wasted pharmaceutical R&D spending (though if
you do, I am willing to bet that you are either under forty, or
female), but the fact that a lot of people are willing to pay a fair
amount of coin for it tells you that they probably feel it is improving
their lives in some significant way. Governments can estimate
cost-benefit when the benefit is limited to crude mortality
improvements, but they are pretty much at sea when it comes to
quality-of-life. America's price signals are wildly distorted by its
insurance markets--but they're almost certainly better than no signal
at all.

Europe's governments operate their health care systems in the
context of an existing US market that provides information about demand
for new treatments (and of course I would argue, also the new
treatments). They don't use that price information to set what they pay
for drugs, but it does filter through to their markets--for example,
more widespread use of Herceptin for breast cancer in the US is putting
pressure on the British government to provide it. I think an American
shift to single-payer would be more problematic than the European
example for a variety of reasons related to our government structure.
But one important reason is that if we did, we'd have no where left to
get prices from.

The More Things Change....

Professor Lance Endersbee, via Tom Nelson:

In the fifteenth and sixteenth centuries the climate in Europe was cold
and unpredictable. Crops failed. Famine followed famine, bringing
epidemics.  There was a belief that crop failures must be due to human wickedness.

But who were the wicked ones? 

It
was believed that there must be some witches who are in the grip of the
devil. Witches were named, Inquisitors tested their faith, and a large
number of poor souls were condemned and burnt at the stake. For decade
after decade, fires burned in most towns in Europe.

Fast-forward to our "enlightened" society today:

"Every time a child dies as a result
of floods in Bangladesh, an airline executive should be dragged out of
his office and drowned
," for causing global warming, rants UK
firebrand George Monbiot. Government leaders "should go to jail" for
failing to act more quickly to prevent planetary climate cataclysm,
insists Canadian eco-zealot David Suzuki. These assertions range from
simplistic and outrageous to straight out of Lewis Carroll.
...
Eco-alarmists
tell impoverished Africans that global warming is the greatest threat
they face "“ when Al Gore uses more electricity in a week than 100
million Africans together use in a year. Those people rarely or never
have electricity and must burn wood and animal dung, resulting in lung
diseases that cause millions of deaths annually. Yet alarmists oppose
fossil fuel power plants, as well as nuclear and hydroelectric projects
"“ guaranteed that Africa's poverty and death toll will continue.

Food-Miles: Most Moronic Metric Ever?

For some reason, a group of people on this earth have convinced themselves that food-miles, or the distance food had to travel from the farm to the table, is somehow relevant to the environment.   Food-miles is one of the best examples of the very common environmental practice of looking at a single factor out of context of the entire system. I have written about the food-miles stupidity before.

We actually have a name for the system in which food-miles are reduced to their theoretical minimum:  Subsistence farming.  It used to be that most food was grown just a few feet from the table where it was eventually eaten because nearly everyone was a subsistence farmer (or hunter or gatherer).  We abandoned this system, and thereby increased food miles, for a number of reasons:

  • It is very inefficient, not just from labor inputs but from a land use standpoint as well.  Some places are well suited to potato or rice production and others are less so.  It makes a ton of sense to grow things on soils and in climates where they are well-suited rather than locally everywhere. 
  • It doesn't work very well in a lot of areas.  Subsistence farming here in Arizona is not very practical, and would use a ton of water
  • It leads to starvation.  Even rich countries like France were experiencing periodic famines just 150 years ago or so.

But the main reason food miles and local subsistance farming is stupid is that it has nothing to do with environmental health.  Everyone looks at the energy to transport food, but no one looks at the extra energy cost (not to mention the land use cost) of growing food locally in climates and soils to which the food is not well-suited.  To this point:

European consumers shunning imported food supposedly to limit climate
change should not make African farmers a scapegoat, a Brussels
conference has been told.

In Britain, several supermarkets have
begun labelling products flown into the country with stickers marked
"air-freighted," to reflect concern about the contribution of aviation
to global warming.

But Benito Müller, a director at the Oxford
Institute for Energy Studies, dismissed the concept of food miles as
"an extremely oversimplified indicator" of ecological impact.

Saying
he was "really angry" with the implicit message that agricultural
produce from Africa should be avoided, Müller claimed that less
greenhouse gas emissions are often emitted from the cultivation and
transport of such goods than they would be if grown in Europe.

Strawberries
imported from Kenya during the winter, he maintained, have a lower
"carbon footprint," a measure to ascertain the effect of a method of
production on the environment "” than those grown in a heated British
greenhouse, even when their transport by air from Africa is taken into
account.

The Health Care Housing Project

The looming federal government takeover of health care as proposed by most of the major presidential candidates will be far worse than anything we have seen yet from government programs.  Take this example:  In the 1960's, the federal government embarked on massive housing projects for the poor.  In the end, most of these projects became squalid failures.

With the government housing fiasco, only the poor had to live in these awful facilities.  The rest of us had to pay for them, but could continue to live in our own private homes.

Government health care will be different.  Under most of the plans being proposed, we all are going to be forced to participate.  Using the previous analogy, we all are going to have to give up our current homes and go live in government housing, or least the health care equivalent of these projects.

Think I am exaggerating
?

One such case was Debbie Hirst's. Her breast cancer had metastasized, and the health service would not provide her with Avastin,
a drug that is widely used in the United States and Europe to keep such
cancers at bay. So, with her oncologist's support, she decided last
year to try to pay the $120,000 cost herself, while continuing with the
rest of her publicly financed treatment.

By December, she had
raised $20,000 and was preparing to sell her house to raise more. But
then the government, which had tacitly allowed such arrangements
before, put its foot down. Mrs. Hirst heard the news from her doctor.
"He looked at me and said: "˜I'm so sorry, Debbie. I've had my wrists
slapped from the people upstairs, and I can no longer offer you that
service,' " Mrs. Hirst said in an interview...

Officials said that allowing Mrs. Hirst and others like her to pay
for extra drugs to supplement government care would violate the
philosophy of the health service by giving richer patients an unfair
advantage over poorer ones.

Patients "cannot, in one episode
of treatment, be treated on the N.H.S. and then allowed, as part of the
same episode and the same treatment, to pay money for more drugs," the
health secretary, Alan Johnson, told Parliament.

Here is the poll question I would still love to see asked:

Would you support a system of
government-run universal health care that guaranteed health care
access for all Americans, but would result in you personally getting
inferior care than you get today in terms of longer wait times, more
limited doctor choices, and with a higher probabilities of the
government denying you certain procedures or medicines you have
access to today.

European vs. American Rail

It seems that one of those cycles the US always castigates itself about is a perception that the Europeans have a better rail system than we do and that we should somehow emulate their system.  Which is why we still have federal subsidies of a half-assed Amtrak system and high-speed rail proposals are circulated breathlessly from time to time. 

By the way, I have been a consultant to French railroad SNCF and I gaurantee we do not want to emulate the European rail system.  First and foremost, the railroads are huge employment boondoggles.  I remember that the SNCF when I was there had something like 100,000 freight cars but 125,000 freight car maintenance people.  I suggested the railroad could assign one individual full time to his own car and still lay off 20% of the work force. 

The main reason we don't have inter-city passenger rail is a simple one that anyone spending 5 minutes with the numbers can understand -- there are distance break points where air travel is more economic than rail, and most US inter-city transit falls into the larger distance ranges.

Anyway, the anti-planner shares a bit of information that is seldom mentioned in the rail discussion that makes the US rail system look a lot more desireable:

Europe has decided to run its rail system primarily for passengers,
while America's system is run mainly for freight. Europe's rail system
has about 6 percent of the passenger travel market, while autos have
about 78 percent. Meanwhile, 75 percent of European freight goes by
highway. Here in the U.S., highway's share of freight travel is only 29
percent, while the auto's share of passenger travel is about 82
percent. So trains get 4 percent of potential auto users in Europe out
of their cars, but leave almost three times as much freight on the
highway.

In fact, the freight rail system is so efficient that to some extent we've obviated the need for the Panama Canal.  Many Asian container ships bound for Europe actually make port in Seattle or Vancouver, offload their containers onto trains which shoot across the country to New York or another eastern port where they are reloaded on ships for the trip to Europe.

By the way, in the same article, don't miss the hilarious proposal in Minnesota to spend taxpayer money for a high speed rail line from the Twin Cities to ... Duluth.  Yeah, that's the ticket.  New York to Boston barely makes it financially, but St. Paul to Duluth is going to be a winner.

Getting the Bureaucrat's Permission to Speak

Ezra Levant has posted YouTube videos of his interrogation by an oily little Canadian bureaucrat called "a human rights officer."  He has done it in a series of post, so go to his site and keep scrolling.  Apparently, in Canada, free speech is not a human right but "freedom from criticism" is, at least for certain politically connected groups  (threatening violence at the drop of a hat also seems to help gain one this "freedom from criticism" right.  Levant is being hauled in by the government for publication of those Danish cartoons that barely register at 0.1 on a criticism meter that goes to 10

This exchange really resonated with me:

Officer McGovern said "you're entitled to your opinions, that's for sure."

Well, actually, I'm not, am I? That's the reason I was sitting
there. I don't have the right to my opinions, unless she says I do.

For all of you who left the US for Canada for more freedom from Bush and the Iraq war, have at it.  Because Bush will be gone and we will be out of Iraq long before Canada (as well as Europe) catch up to the US in terms of its protection of [most] individual rights, like free speech.

via Maggies Farm

Update, from Mark Steyn:

Ms McGovern, a blandly unexceptional bureaucrat, is a classic example
of the syndrome. No "vulnerable" Canadian Muslim has been attacked over
the cartoons, but the cartoonists had to go into hiding, and a gang of
Muslim youths turned up at their children's grade schools, and Muslim
rioters around the world threatened death to anyone who published them,
and even managed to kill a few folks who had nothing to do with them.
Nonetheless, upon receiving a complaint from a Saudi imam trained at an
explicitly infidelophobic academy and who's publicly called for the
introduction of sharia in Canada, Shirlene McGovern decides that the
purely hypothetical backlash to Muslims takes precedence over any
actual backlash against anybody else.

Uncovering Some Really Bad Science

Kevin Drum thinks he has a killer analysis supporting government health care.  In a post he titles sarcastically "Best Healthcare In the World, Baby," Drum shares this chart:

Blog_deaths_amenable_healthcare

The implication is that the US has the worst healthcare system, because, according to this study, the US has the highest rates of "amenable mortality," defined as deaths that are "potentially preventable with timely and effective health care."

I get caught from time to time linking to studies that turn out to have crappy methodology.  However, I do try to do a little due diligence each time to at least look at their approach, particularly when the authors are claiming to measure something so non-objective as mortality that was "potentially preventable."

So, when in doubt, let's look at what the author's have to say about their methodology.  The press release is here, which gets us nowhere.  From there, though, one can link to here and then download the article from Health Affairs via pdf  (the site is gated but I found that if you go through the press release site you can get in for free).

The wording of the study and the chart as quoted by Mr. Drum seem to imply that someone has gone through a sampling of medical histories to look at deaths to decide if they were preventable deaths.  Some studies like this have been conducted.  This is not one of them.  The authors do not look at any patient data.

Here is what they actually did:  They arbitrarily defined a handful of conditions as "amenable" to care.  These are:

Ischemic Heart Disease (IHD)
Other circulatory diseases
Neoplasms (some cancers)
Diabetes
Respiratory diseases
Surgical conditions and medical errors
Infectious Diseases.
Perinatal, congenital, and maternal conditions
Other (very small)

All the study does is show how many people died in each country from this set of diseases and conditions.  Period.  It doesn't determine if they got care or if they in particular could have been saved, but just that they died of one of the above list of conditions.  This study was not an effort to identify people who died when their particular condition should have been preventable or amenable to care;  all it measures is the number of people in each country who died from list of conditions.  If Joe is talking to me and in the next second flops over instantly dead of a massive heart attack, the author's consider him to have died of a disease amenable to care.

We can learn something by looking at the breakdown of the data.  If you can't read the table below, click on it for a larger version

Amenablediseases_2

Let's take the data for men.   The study makes a big point of saying that France is much better than the US, so we will use those two countries.   In 2003, France has an "amenable disease" death rate 56 points lower than the US.  But we can see that almost this whole gap, or 42 points of it, comes from heart and circulatory diseases.  The incidence of these diseases are highly related to diet and lifestyle.  In fact, it is well established that the US has a comparatively high incidence rate of these diseases, much higher than France.  This makes it entirely possible that this mortality difference is entirely due to lifestyle differences and disease incidence rates rather than the relative merits of health care systems. In fact, this study is close to meaningless.  If they really wanted to make a point about the quality of health care systems, they would compare them on relative mortality with a denominator of the disease incidence rate, not a denominator of total population.

But in their discussion, the study's authors reveal themselves to be, if I am reading them right, complete idiots in terms of statistical methods.  The authors acknowledge that lifestyle differences may be a problem in their data.  This is how they say they solved this problem:

It is important to recognize that the development of any list of indicators of amenable mortality involves a degree of judgment, as a death from any cause is typically the final event in a complex chain of processes that include issues related to underlying social and economic factors, lifestyles, and preventive and curative health care. As a consequence, interpretation of findings requires an understanding of the natural history and scope for prevention and treatment of the condition in question. Thus, in the case of IHD, we find accumulating evidence that suggests that advances in health care have contributed to declining mortality from this condition in many countries, yet it is equally clear that large international differences in mortality predated the advent of effective health care, reflecting factors such as diet and rates of smoking and physical activity.16 To account for this variation, we included only half of the mortality from IHD, although, based on the available evidence, figures between, say, 25 percent and 70 percent would be equally justifiable.

I have a very smart reader group, so my sense is that many of you already see the gaffe here.  The author's posit that 50% of heart disease may be due to lifestyle, though the number might be higher or lower.   So to correct for this, they reduce every country's heart disease number (IHD) by a fixed amount of 50%.  WTF??  This corrects for NOTHING.  All this does is reduce the weighting of IHD in the total measure. 

Look, if the problem is that lifestyle contribution to heart disease varies by country, then the percentage of IHD deaths that need to be removed because the deaths are lifestyle related will vary by country.  If the US has the "worst" lifestyle, and the number for lifestyle deaths is about 50% there, it is going to be less than 50% in every country.  The correction, if an accurate one could be created, needs to be applied to the variance between nations, not to the base numbers.  Careful multiple regressions might or might not have sorted the two sets of causes apart, but dividing by 50% doesn't do anything.  This mistake is not just wrong, it is LAUGHABLE, and calls into question the author's qualification to say anything on this topic.  They may be fine doctors, but they don't know squat about data analysis.

There may be nuggets of concern for the US lurking in this data.  I don't know how they measure deaths from surgical conditions and medical errors, but its not good to be higher on this.  Though again, you have to be careful.  The US has far more surgeries than most other countries per capita, so we have more surgical deaths.  Also, medical error data is notoriously difficult to compare country to country because reporting standards and processes are so different.  In the US, when the government measures medical errors, it is a neutral third party to the error.  In Europe, the government, as healthcare provider, is often the source of the error, calling into question how aggressive these countries may be in defining "an error."  Infant mortality data is a good example of such a trap.  The US often looks worse than European nations on infant mortality because it is defined as infant deaths as a percentage of live births.  But the US has the most advanced neo-natal capabilities in the world.  Many pregnancies that would result in a "born dead" in other countries result in a live birth in the US.  Since these rescued births are much more problematic, their death rate is much higher.

There is good news for the US in the study.  The item on this list most amenable to intensive medical intervention is cancer (neoplasms in the study above).  In that category, despite a higher incidence rate than many of these countries, the US has one of the lowest mortality rates as a percentage of the total population, which implies that our cancer mortality in the US as a percentage of cancer incidence is much better than these countries.  This shows our much higher 5-year cancer survival rates.

Update:  I thought this was pretty clear, but some of the commenters are confused.  The halving of IHD numbers was applied to all countries, not just the US.  So the actual male US IHD number is about 100 before halving and the actual French number is about 40.  Again, this halving only reduces the weighting of IHD in the total index; it in no way corrects for differences in incidence rate. 

What Goes Around, Comes Around

For years, protectionists in this country have tried to argue that "oh, I am really for free trade, but to be fair we must impose environmental and labor standards on our trading partners."  Well, now Europe is proposing doing exactly the same to us:

The European Commission is considering proposing a
carbon dioxide tariff on imports from states failing to tackle
greenhouse gas emissions, while also considering a toughening-up of the
EU's own emission trading system....


The plan reflects pressure by French president Nicolas Sarkozy who
argued in October that Europe should "examine the option of taxing
products imported from countries that do not respect the Kyoto
Protocol," referring to the 1997 international agreement on fighting
climate change.

Mr Sarkozy urged Brussels to discuss the implications of "unfair
competition" by firms outside the EU, which do not have to abide by
strict European standards on CO2 emissions.

This letter from Don Boudreaux seems relevant:

Hillary Clinton needs a
language lesson.  She favors only trade that is found by government to
"benefit[] our workers and our economy" and that promotes "rising
standards of living across the world" ("" December 3; my emphasis).  She then asserts that "There is nothing
protectionist about this."

Oh please.

Protectionism
exists whenever, wherever, and whyever government artificially raises
its citizens' costs of buying imports.  Protectionism has forever
rested on the false notion that government officials know best how
consumers should spend their money.  And it attempts today to hide its
ugly face behind the smiling mask of allegedly noble intentions, such
as those mouthed by Sen. Clinton.

The title of his post is "The Moment Somone Must Explain that He or She Isn't a Protectionist, You Can Bank on that Person Being a Protectionist."

 

Regulation Protects Industry Incombents

I often see folks who are arguing for increased government regulation of some industry observe that "even those greedy corporations in this industry support this new regulation."  For example, if a power company takes a public position to support greenhouse gas emissions, then that is used as evidence that such regulation must really be necessary if even the to-be-regulated are in favor.  Greg Craven makes such an argument in his global warming video that I refuted the other day.

There are two very good reasons a company in such a position might publicly support even a bad regulation.  The first is basic politics and PR:  If the regulation appears inevitable and has public support, then it is sometimes better to get out ahead of it and try to curry favor with politicians and the public to manage the regulation's implementation.   We all know corporations give donations to political candidates, but look at how they give them.  Corporate donations correlate far better with "who is expected to win" rather than "who would create the most favorable regulatory environment for the corporation."  In fact, corporations are highly likely to give donations to both candidates in a closely-fought election, and a lot of their giving is after the election, to the winner of course.

The other good reason that companies support regulation in their industry is because a lot of regulation is either designed to, or effectively, helps incumbent companies against new entrants.   I have talked about this many times with the questioning of licensing.  Global warming regulation and carbon trading systems in particular give us another great example:

BBC News understands the industry will be allowed to increase emissions
as much as it wants by the European environment council. Aviation is
the fastest growing source of greenhouse gases. But Europe's
environment ministers look set to reject a plan for a strict cap on
emissions from planes. Instead, airlines will be given a set number of
permits to pollute.

Instead, airlines will be given a set number of permits to pollute.

If
they overshoot their limit they will be allowed to buy spare permits
from firms who have managed to cut emissions elsewhere - manufacturing
industry, for instance.

So, current airlines in Europe will be given carbon permits that presumable support their current business level.  However, any new entrant, or any current player wishing to take market share from another airline, must spend money on carbon credits to grab this market share, carbon credits the current established incumbents got for free.  This in effect becomes a tax on market share gains.  This European-style protection of large corporations is typical, and is why the 30 largest companies in Europe are nearly the same as they were in 1965, but are completely different in the US.

This is also why, though I don't think expensive action on CO2 is justified, I think that if we do so the approach must be a carbon tax rather than cap and trade.   But cap and trade has so much potential for political hijinx and giving special deals to the politically influential that my guess is that politicians will want cap and trade.

Wow, Media Sees Dumb Lawsuit for What it Is

In the earlier days of this blog, I used to post links to a lot of insane lawsuits.  The lawsuits just keep coming, but I have lost the energy to keep posting such stupidity.  And besides, Overlawyered does such a good job and seems to have infinite patience. 

But it was worth noting a silly shareholder suit that the media actually seems to have sniffed out for what it is:  Pure garbage.  For those who are not aware, there are a group of law firms who immediately file suit against any company whose stock drops by more than a few percent.  Bill Lerach, soon to be taking up residence in jail, used to keep a whole bullpen of folks on a sort of retainer to hold shares in numerous companies, so he instantly had someone close at hand who could file suit when any stock drops.  And since stocks go up and down, often in ways that the company itself has no control over, this leads to a lot of lawsuits.

Recently, the maker of Crocs sandles apparently had an IPO, had its stock price shoot up, and then had its stock price fall back when the company could not sustain its previous torrid growth pace.  Al Lewis of the Denver Post takes it from there:  (HT Overlawyered, of course)

Anybody who purchased stock in
Niwot-based Crocs Inc. between July 27 and Oct. 31 should not join the
class-action shareholders lawsuit that was recently filed against the
company and its stock-dumping executives.

Instead, they should look themselves in the mirror and admit two things:

      

I look ridiculous in these plastic shoes.

      

Anybody
who would pay an average of more than $60 a share for a company that
makes ugly plastic shoes deserves to take a hit in the stock market.

He continues:

Crocs and its officers also allegedly
misrepresented or failed to disclose their distribution problems in
Europe and their rising inventory levels, the lawsuit alleges. They
also failed to disclose that sales of their hole-riddled plastic clogs
were suddenly becoming more of a seasonal item. Imagine that! Sandals
seasonal? Who knew?

By the way, if you really want your head to explode, take a minute a think about shareholder lawsuits.  A group of shareholders are suing the company for a fall in the stock price.  Who do you think pays?  Why, current shareholders!  Though I do not accept the "logic" of these suits, if one were to accept their logic, then the most guilty party is the stockholder who sold the plaintiffs their stock just before the drop.  But these folks are exactly who will NOT owe any money on the suit.  They are no longer owners.  The people who will pay will be the owners of the stock at whatever time the suit settles, likely many people who bought in after the plaintiffs did.  The only real winner when the shareholders pay themselves such a verdict are the lawyers, who rake off 30%.  More on this bizarre situation here.

Update:  I will have to think about this more, but it kind of reminds me of a prisoners dilemma game in which the prosecutor gets a monetary bonus that increases with longer prison terms.

Immigration Thought of the Day

Frequent readers will know that I am a strong supporter of open immigration.  I don't disagree with McQ at Q&O when he writes "Open Borders or Welfare State: Pick One," but I don't think that this is the logic of most folks who are anti-immigration.  It may be their public stance, but if more folks really thought this way, there would be serious discussion of tiered citizenship or guest worker models similar to what I have proposed on several occasions.

However, I am tempted to become a close-the-border proponent if the left continue to use numbers skewed by immigration to justify expansions of taxation and the welfare state.  Whether they are illegal or not, whether they should be allowed to stay or not, the fact is that tens of millions of generally poor and unskilled immigrants have entered this country over the last several decades.  These folks dominate the lower quintile of wage earners in this country, and skew all of our traditional economic indicators downwards.  Median wages appear to be stagnating?  Of course the metric looks this way -- as wages have risen, 10 million new folks have been inserted at the bottom.  If you really want to know what the current median wage is on an apples to apples basis back to 1970, take the current reported median wage and count up about 10 million spots, and that should be the number -- and it will be much higher. 

Income distribution numbers are the same way.  I showed in a previous post how these numbers are deceptive, when we compare them to Europe, because though European poor have a higher percentage of the median wage in their country, it is a higher percentage of a lower number.  When you correct for that effect, the US poor look pretty equal.  But immigration exaggerates this effect even more.  Instead of having income distribution numbers comparing, say, a lawyer and a blue collar worker, they are now comparing a lawyer and a non-English-speaking recent unskilled immigrant.  Of course the disparity looks worse!

The folks using these numbers have to be smart enough to understand this issue, so it can only be hugely disingenuous that they simultaneously promote immigration (which I support) while at the same time using immigrant-skewed numbers to say that the average US worker is somehow worse off.  If they keep this tactic up, even I may be tempted to close the borders.

We Just Don't Have Enough Taxes

I propose a survey.  We will ask 500 CEO's of large company's and 500 small business owners just one question

1.  Do you agree/disagree with the following statement:  In order to make my business more competitive in international markets, the federal government needs to raise taxes and expand its scope

How many out of the 1000 would answer "Agree?"  Well, at least the number won't be zero, as long as you ask the NY Times:

"¦the taxes collected last year by federal, state and local governments in the
United States amounted to 28.2 percent of gross domestic product. That
rate was one of the lowest among wealthy countries - about five
percentage points of GDP lower than Canada's, and more than eight
points lower than New Zealand's. "¦the meager tax take leaves the United
States ill prepared to compete. From universal health insurance to
decent unemployment insurance, other rich nations provide their
citizens benefits that the U.S. government simply cannot afford.
"¦revenue will prove too low to face the challenges ahead.

I love the part about unemployment insurance particularly -- other countries are more competitive than we are because they pay their citizens more not to work.  Huh?  Daniel Mitchel responds:

The editorial conveniently forgets to explain, though, how America is
less competitive because of supposedly inadequate taxation. Is it that
our per capita GDP is lower than our higher-taxed neighbors in Europe?
No, America's per capita GDP is considerably higher. Is it that our disposable income is lower? It turns out that Americans enjoy a huge advantage in this measure. Is our economy not keeping pace? Interesting thought, but America's been out-performing Europe for a long time. Could higher rates of unemployment be a sign of American weakness? Nice theory, but the data show better job numbers in the United States.

I also would point out the general direction of net immigration, which has always been towards the US from nearly every country in the world rather than the other direction.

The favorite argument du jour for more taxes is that the US has more income inequality than other countries.  Well, that is sort of true.  Our rich are richer than theirs.  But are our poor poorer?  In fact, as I posted here, the data (from a liberal think tank) shows that they are not.   The poor in European countries have a higher percentage of a lower median wage.  When you normalize European income distribution numbers to percentages of the US median wage, you can see our poor do at least as well as those in Europe, while our middle class and rich do better.

Study2

The US poor still trail countries like Switzerland, but that is because of very different immigration realities.  The US numbers for the bottom quartile are weighed down by tens of millions of recent immigrants (both legal and not) whereas those of Switzerland and Norway are not.  If you left out recent immigrants, my guess is that the US poor would be the richest in the world.

Poverty Ain't What it Used to Be

The Heritage Foundation has an interesting study out on the population that lives below the poverty line.  While we typically get lots of headlines like "A million more people in poverty,"  the real headline should be "Poverty ain't what it used to be."  Create a mental image for yourself about poverty then read the first part of the article.

I won't repeat the studies points -- you can read them at the link or you have probably seen the study already linked around the blogosphere (e.g. Captains Quarters, Cato-at-Liberty, Reason, Maggie's Farm).  Reading the descriptions, its clear that most of our visual images and assumptions about US "poverty" don't line up well with this list.   This is by design.  Progressives who want more transfer payments and more government interventionism work hard to create a stark mental image of poverty through anecdotes, and then try to apply that mental image to a much larger population based on a very different definition of poverty than in this mental image. 

However, this approach may be set to backfire.  By defining poverty broadly to try to pump up the numbers, they are at risk of people losing sympathy for the poor.  I can see the progressive reaction now -- they are going to say (correctly) that buried in these numbers are a hard core of people who are really destitute.  And they are correct.  But they only have themselves to blame for burying these folks in a larger group whose lives don't match our mental picture of poverty.  And the poverty numbers aren't the only place where this approach is taken. 

I am sure you have heard the commercials that say something like one in six kids in America are hungry.  It's a crock.  There are at most perhaps 2-3 million people in this country who are really destitute.  The Census department found that only 6% of the people below the poverty line, about 2 million people, reported they sometimes did not have enough food to eat.  Sure, that sucks.  Which is why I volunteer with my kids at the local food bank.  But it's way, way short of the numbers activists try to use to justify huge new government programs and transfers.

Other thoughts

One issue not discussed, but covered in other studies, is the transience of people in the bottom quintile of income.  Most of us imagine the same people in poverty survey after survey, and again that is probably true for the hard core of 2-3 million.  But many of the rest move out of poverty over time.  In particular, we have had a huge influx of immigrants (legal and illegal) over the last several decades.  These folks are all counted in the poverty numbers.  Many immigrants arrive below the poverty line, and then work their way out of it. 

In a related post, Brad DeLong looks at what life was like even for the well off in 1900, and one can easily come to the conclusion that being poor today might be better than well off in 1900.  I made a similar point in this post, when I compared the life of the very rich in 1850 to the middle class today.  All of this is empirical proof that wealth is not zero-sum, as assumed by progressives, but is created and expends.  My post of the zero-sum wealth fallacy is here.

I've made the point for a long time that our poor are better off than the middle class in most countries of the world.  This living space comparison is an example - our poor typically have more living space in their homes than the middle class in Europe, or the well-to-do in many other countries.  But there is always that issue of income inequality that is raised, to which I typically answer "so what?"  If the poor are better off in the US, does it matter if the rich are really, really better off?  Note sometime the language that is always used in income inequality discussions.  You will hear folks talking about the "share of total income" as if income is a spring bubbling up in the desert, spewing a fixed amount of wealth, and the rich are the piggy folks up front getting more than their fair share of this limited resource. 

Leftish studies love to show how the US economic model is so much more heartless than those wonderful Europeans.   Below is a typical chart they use, and it will bring us full circle to our original point about measuring poverty.

Study1

Wow, those heartless damn Americans!  Letting those children suffer.  But wait, we talked earlier about definitions of poverty - how do they define poverty here?  It turns out that poverty is defined as income 50% or less of the median income in that country.  Yes, you heard that right -- the standard for poverty changes country to country.  So the US has the worst results here because in large part, since it has the highest median income of any country in this survey, it has been given the highest poverty line.  Of COURSE we will have higher poverty numbers if you give us a higher poverty bar.  The honest way to do this study would be to set an absolute poverty line and apply it to each country on a purchasing power parity basis.  But of course, the progressives would not like the results of such an honest study.

BUT, someone in this study made a mistake -- they should lose their socialist decoder card for this.  Because in a fit of honesty, they actually restated one of their charts on a relatively fair basis.  Here is the original income equality chart:
Study3

You get the point, the US sucks as always -- our poor are the poorest.  But are they?  Again, the standard in each line is the median income of that country, so it is a changing standard in each case.  But what if we restated it all to a common dollar amount.  This is where the progressives fell into a fit of honesty.  They restated this chart so that every bar is a percentage of the US median income.

Study2

Now we see the real story - except for Norway and Switzerland, our poorest folks are about on par with those in other western countries, and this is WITHOUT the crushing burden of welfare state regulation and taxation.  Further, the poor in the US are much more mobile than those in other country -- the ranks of our poor will have turned over much more than any of these other countries in 10 years.  Finally, my bet is that if you did this chart without recent immigrants, the US poor would best most every country in Europe in terms of income -- US has a lot of immigration and it is disproportionately poor vs. immigration into other European countries (note that most poverty numbers include illegal immigrants, but most official immigration numbers do not include illegal immigrants).

So, if our poor are doing just as well, then I leave it as an exercise to give any rational reason why the fact that our rich are doing much better matters one damn bit.

Is Belgium Collapsing?

The amount I know about Belgium could probably be written on a post card (except for its role in military history, which is substantial due to its location and its famously brave stand against Germany in the opening act of WWI).  So this article about the tremendous split developing between French (Wallonia) and Flemish (Flanders) Belgium was new to me.  In particular, I noted this:

Every year 6.6% of Flanders' GDP is spent on welfare in Wallonia.
The money has not helped the Walloons but turned them into welfare
addicts. Belgium is a case study of how socialist redistribution
schemes lead to economic perversions.

It appears that 60% of Wallonians are either unemployed or on the government payroll (roughly the same thing in Europe), vs. just 28% in Flanders.  And this despite the fact that Brussels and the EU HQ are in Flanders.

State Run Medicine: Bureaucrat Salaries Trump Patients

Italian Daniele Capezzone writes in the WSJ($):

This situation is especially dire in Italy. The
government has capped spending on pharmaceuticals at 13% of total
health-care expenditures while letting expenses for infrastructure and
staff skyrocket. From 2001 to 2005, general health expenses in Italy
grew by 31% while expenditure on medicines increased a mere 1.7%.
Italian patients might well have been better off if the reverse was the
case, but the state bureaucrats who make these decisions refuse to
acknowledge the benefits of advanced drugs....

Part of the problem is that regional authorities
manage most of Italy's health-care spending. A strike by health-care
personnel has an immediate impact on the region, but the consequences
of cutting the budget for medicines are only felt in the long term and
distributed across the nation. Hence, local authorities continue to
focus on personnel and infrastructure in an age when medical research
has become the most efficient way to improve public health.

Gee, government officials more concerned about raising government salaries than performance?  Couldn't possibly happen in the US, could it?  This is classic government management -- freeze or reduce expenses that actually provide customer service, and raise administrative costs and salaries many times faster than inflation.  This is exactly what has happened in public schools, as infrastructure and teaching aid investments have been deferred in favor of raising salaries and adding untold number of vice-principals and administrators to every school.

But the government is focused on the long-term while greedy old for-profits are short-term focused.  Right?

Unfortunately, most of today's cutting-edge research is conducted
outside Europe, which was once a pioneer in this field. About 78% of
global biotechnology research funds are spent in the U.S., compared to
just 16% in Europe. Americans therefore have better access to modern
drugs. One result is that in the U.S., the annual death rate from
cancer is 196 per 100,000 people, compared to 235 in Britain, 244 in
France, 270 in Italy and 273 in Germany.

Update:  Ronald Bailey points out that drug re importation is just a way to impose drug price controls in the US, effectively applying the most aggressive price-control regime for each drug worldwide to US prices.  Right now, drug companies tolerate price controls set as much as 2/3 under US prices or more because they can still make money at the margin, because the marginal cost of drug production is so much lower than the total cost with R&D, etc. included.  However, they cannot survive at these prices applied to US demand.  Remember, drug companies have profits margins averaging in the 18-20% range.  Perhaps you might argue they should only be making 10%, but that only gives you room for an imposed 10% price cut, not the huge cuts politicians would like.  And you would get that only at tremendous costs in terms of lost freedoms and demolished incentives for new drug development.

More Subsidy Insanity

Over a decade ago, the German government adopted the goal of reducing the country's CO2 emissions back to 1990 levels as part of the Kyoto process.  That's why its incredible to me that after spending billions on various goofy and questionable conservation and alternative energy programs, someone has finally thought to maybe stop massively subsidizing coal production.

For decades, German lawmakers have propped up the industry,
unwilling to risk massive layoffs and reluctant to eliminate a reliable
energy source as gas and oil supplies become scarcer.

But after spending more than $200 billion in subsidies since the
1960s, the federal government this year decided that the practice had
become unaffordable. The 2018 sunset for the hard-coal industry was set.

Economists and free-market lawmakers have long decried the subsidies
as handouts to the politically influential coal industry and powerful
trade unions. This year, for instance, Deutsche Steinkohle AG, the
owner of the remaining eight mines, will receive more in government
subsidies ($3.3 billion) than it will from selling coal ($2.9 billion).

With just 32,000 miners left, that's the equivalent of more than $100,000 in annual subsidies per worker.

I don't know what is more incredible -- $100,000 per worker or the fact that subsidies actually are larger than revenue from coal sales.  In effect, the government is subsidizing more than half of coal's production costs.

Sometimes we in the US forget just how insane the economy in Europe can be.  I remember doing a consulting project for the French national railroad, the SNCF.   It turned out the SNCF, for it's 100,000 freight cars had ... 125,000 freight car maintenance workers.  The headcount number was so insane I had to check it three times to make sure it was right.  I commented at the time that they could assign one car repair worker full time to each freight car, and have him ride around with that car full time, and still cut staffing by 20%.

Government Health Care and Efficiency

I am always absolutely amazed when advocates of some form of national or single-payer health care argue that such a system would be more efficient.  For example, Kevin Drum argued:

A few days ago, during an email exchange with a
friend, I mentioned that I don't usually tout cost savings as a big
argument in favor of universal healthcare. It's true that a national
healthcare plan would almost certainly save money compared to our
current Rube Goldberg system, but I suspect the savings would be
modest. Rather, the real advantages of national healthcare are related
to things like access (getting everyone covered), efficiency (cutting down on useless -- or even deliberately counterproductive -- administrative bureaucracies), choice
(allowing people to choose and keep a family doctor instead of being
jerked around everytime their employer decides to switch health
providers), and social justice (providing decent, hassle-free healthcare for the poor).

I don't think any of these are true.  For example, let's take access.  Yes, everyone in a universal health care system would have a piece of paper that says they have health care, and the left seems really focused on that piece of paper.  But that paper has about as much value as my piece of paper that says I own a hundred shares of Enron.  Because someone has to redeem that piece of paper and actually provide the care, and there is the rub, is it not?  Canadian David Gratzer writes (vis Q&O):

My book's thesis was simple: to contain rising
costs, government-run health-care systems invariably restrict the
health-care supply. Thus, at a time when Canada's population was aging
and needed more care, not less, cost-crunching bureaucrats had reduced
the size of medical school classes, shuttered hospitals, and capped
physician fees, resulting in hundreds of thousands of patients waiting
for needed treatment"”patients who suffered and, in some cases, died
from the delays....

Nor were the problems I identified unique to
Canada"”they characterized all government-run health-care systems.
Consider the recent British controversy over a cancer patient who tried
to get an appointment with a specialist, only to have it canceled"”48
times. More than 1 million Britons must wait for some type of care,
with 200,000 in line for longer than six months. A while back, I toured
a public hospital in Washington, D.C., with Tim Evans, a senior fellow
at the Centre for the New Europe. The hospital was dark and dingy, but
Evans observed that it was cleaner than anything in his native England.
In France, the supply of doctors is so limited that during an August
2003 heat wave"”when many doctors were on vacation and hospitals were
stretched beyond capacity"”15,000 elderly citizens died. Across Europe,
state-of-the-art drugs aren't available. And so on.

I had forgotten about the heat wave.  Could you imagine backwards old America having 15,000 people die when the temperature got into the 90's?

As to efficiency, which Drum defines as "cutting down on useless -- or even deliberately counterproductive -- administrative bureaucracies," does anyone really ascribe these characteristics to the government?  Really?  Even European health care bureaucrats would not agree with this statement:

This privatizing trend is reaching Europe, too.
Britain's government-run health care dates back to the 1940s. Yet the
Labour Party"”which originally created the National Health Service and
used to bristle at the suggestion of private medicine, dismissing it as
"Americanization""”now openly favors privatization. Sir William Wells, a
senior British health official, recently said: "The big trouble with a
state monopoly is that it builds in massive inefficiencies and
inward-looking culture."

I won't get much into the last two, except to say that we actually have a ton of health care choice in the US today, far more than any other country.  And even if we did not, what does doctor choice mean if the best people are driven away from being doctors, as they are in socialized medicine.  And social justice?  Well, the poor get care in the US, the key is the "hassle-free" in his statement.  Would you immediately assume that a government-run service is going to involve less hassle than a private service?  Have you renewed your drivers license lately?  It may well be that the poorest 10% have such an awful health care experience that they will see things better.  But almost assuredly the other 90% are going to be worse off.

Remember this -- Universal health care is NOT a system in which the majority of us who are satisfied with our care can keep our current system, while the poor get a better one.  It is a system where all of us are thrown out of our current system and given the same care the poor get.  It is roughly equivalent to a Great Society housing program in which not just the homeless get housing, but everyone in the country are forced to give up their current house and live in public housing.

Postscript:  There is great improvement to be had in the health care system.  It revolves, though, around making the payer for health care the same person who receives the service, as it is for every other product and service we buy in this country.  We already have too much single-payer.  We need multi-payer.  I won't go there today, but I explained here.

Another Thought:
A huge pillar of the women's movement was that the government should not make decisions for a woman and her body (e.g. by banning abortion).   All well and good.  But I have never understood how this was consistent with support, say, for the FDA, which tells women exactly what they can and can't put in their body.  And now women's groups are all for universal health care, where government will make all the medical decisions about what procedures one can and can't have, and when.  Consistency please?

Chapter 7: The Effects of Global Warming (Skeptics Guide to Global Warming)

The table of contents for the rest of this paper, . 4A Layman's Guide to Anthropogenic Global Warming (AGW) is here Free pdf of this Climate Skepticism paper is here and print version is sold at cost here

There is no area in global warming discussions where AGW
advocates have done more to shoot down their own credibility than in the
absolutely egregious science and absurd claims that have been made about the
potential negative effects of global warming.  If AGW advocates are frustrated
that skeptics question their science and their credibility, they need to look
no further than their own claims on global warming effects, which are so easy
to prove wrong that it causes people like me to question everything else they
say.

Why only bad stuff?

Whenever global warming is discussed in the press, the
consequences are all universally bad.  Floods, famine, drought,
pestilence, disease "“ they are all commonly predicted results of global
warming.  But it is worth noting that in the 1970's, when climate
scientists and the press were in a panic over global cooling, the predicted
results were"¦ floods, famine, drought, pestilence, disease.  The
implication is that we currently happen to be balanced on the knife edge of
exactly the optimum world temperature for mankind.  Any change warmer or
cooler results in net negative consequences.

This, of course, seems an odd coincidence.  Since man
evolved into homo sapiens, he has experienced a wide range of cooler and
warmer temperatures than we experience today.  It seems frankly amazing
that in the mid 20th century we happened to be sitting at the
absolute ideal temperature for modern technological society and
agriculture.  Now, I guess you can argue that our society has made
enormous investments based on the locations of the best crop lands, the height
of the oceans, the typical paths of storms, etc., and that shifts in any of
these would force an expensive restructuring of these investments.
However, it is also worth noting that from the bottom of the Little Ice Age to
say 1980, the world warmed at least a degree, and no one really
noticed!  Everyone was still talking about cooling!

So I think that any honest analysis of the effects of global
warming would have to acknowledge that there are likely both positive and
negative effects.  While some areas may experience heat-induced droughts,
other will be wetter as more moisture from the oceans is evaporated.
While some crops will struggle, others, particularly in northern latitudes, will
thrive due to longer growing seasons.  For each crop of vegetables that
wilt in a heat wave there will be a crop of citrus that didn't freeze.
While more may die from the heat, fewer will die from the cold.  These may
still net to a negative sum, but that net sum will be substantially less
negative than a one-sided look at only the downsides of warming would arrive
at.

One reason that warming impact analysis is hard is because while we may talk
about the world warming a degree or two, the world does not warm evenly.
Most climate models show the most warming on dry winter nights  (Siberian
winters, for example, get a disproportionate share of the warming).  An
extra summer degree in Arizona would suck; an extra winter degree in Siberia
would probably be welcomed, and would likely extend growing seasons.

In the rest of this chapter, I will spend some time with a number of the
most common "scary results" from global warming.

Ice melting / ocean rising 

In An Inconvenient Truth, Al Gore claims that oceans will
rise twenty feet due to global warming.  Helpfully, a number of websites
have been created to show what parts of the world (including much of Florida)
would sink beneath the oceans like Atlantis with a 20-foot rise in sea level.

Fortunately, even most AGW supporters believe that Gore is
wildly exaggerating, at least for any time period less than a couple of
centuries.  The Fourth IPCC report (see chart below) predicts sea level
rise by the year 2100 of "¦ 12-15 inches.  And remember that this is based
on forecasts of both CO2 production and climate sensitivity to CO2 that are
arguably high by a factor of two or more.  From the fourth IPCC report
(different columns are for different starting CO2 forecasts):

By the way, to give a sense of scale, the IPCC estimates
that the oceans have already risen about 0.2 meters in the last 130 years or
so:

One other interesting thing you can see from the sea level
forecast chart is that even the IPCC considers ice melting virtually
irrelevant.  That is because most of the surface level increase is from
thermal expansion of the water as the oceans warm.  In the A1B case, for
example, net worldwide ice melt raises oceans by about 4 inches in the next
hundred years. 

This last conclusion may seem crazy to anyone who has
watched the media of late or seen Mr. Gore's movie.  Images of ice
crashing into the ocean and sea ice retreating are common fodder for global
warming visuals.  But the fact is that ice, like everything else in
climate, is complicated.

  • North Pole:  Arctic sea ice melting is totally
         irrelevant to ocean surface levels.  Since the ice floats, even a
         100% melting of the Arctic ice will not change sea level one bit, just as
         ice melting in your glass of water does not cause your glass to
         overflow. 

But some may argue that this ducks the
question.  Does current, well-documented retreat of artic ice sheets
provide independent confirmation of the magnitude of AGW?  In fact, though
ice sheets are retreating, this seems to be part of a two hundred year trend
that began long before man was burning fossil fuels in any quantity:

  • Alpine Glaciers:  We know that many Alpine
         glaciers around the world are retreating.  Some of this is surely
         from global warming, but some is also from fluctuations in
         precipitation.  In many cases, we have documented evidence that these
         glaciers have been retreating since the 19th century, and that
         they have been less extensive in the past.

Reid A. Bryson is Emeritus Professor and founding
chairman of the University of Wisconsin Department of Meteorology"”now the
Department of Oceanic and Atmospheric Sciences and a member of the United
Nations Global 500 Roll of Honor.  When asked about
the retreat of Alpine glaciers
, he says, "What do they find when the ice
sheets retreat, in the Alps?  A silver mine! The guys had stacked up their
tools because they were going to be back the next spring to mine more silver,
only the snow never went," he says. "There used to be less ice than now. It's
just getting back to normal."

Alaska Geographic published a chart of the retreat
of the glaciers at Glacier Bay, Alaska, showing most of the retreat occurred before
the 2nd half of the 20th century:

One special note should be made of the glaciers on
Kilimanjaro, because their retreat over the last 125 years has been
well-documented and played a starring role in An Inconvenient Truth.  Analysis
has shown that most the glacial retreat at Kilimanjaro occurred before 1953
(and therefore before most recent warming) and that the retreat has
more to do with moisture in the air than with global warming
.  One
wonders why the movie, with glacial retreats around the world that are provably
due to warming, would focus on one that is probably not due to warming.

· Greenland: 
Greenland has a lot of ice, and there is not much doubt that if it all melted,
the oceans would rise a lot.  However, we know that in the middle ages,
Greenland was much warmer and had less extensive ice coverage (thus the name
Greenland and the successful attempt to farm it for over a century)

While there is a lot of discussion about whether
the Medieval Warm Period extended worldwide, most accept that it did cover the
North Atlantic, including Greenland.  Boreholes, such as the Dahl-Jensen
below, seem to prove out our historical information, showing a temperature peak
around the year 1000.

· Antarctica:
Something like 80-85% of the world's ice is in Antarctica.  And no one
really thinks it is melting or going to melt.  In fact, if you look at the
marks on the IPCC chart above for the contribution of Antarctic ice to ocean
levels, it has a net negative impact, which means the IPCC actually expects the
Antarctic ice sheet to grow, not melt.

Whoa, that can't be right!  Mr. Gore showed those videos of ice retreating
in Antarctica.  Well, yes, sort of.  Scientists expect that global
warming will make the sea currents that circle Antarctica a bit warmer, leading
to more precipitation and more snowfall on the continent.  Besides,
Antarctica is so damn cold that raising temperatures a few degrees is not going
to melt anything. 

The one exception is the Antarctic Peninsula, which
sticks out into the warmer oceans.  This land area, representing about 2%
of the Antarctic land mass and even less of its total ice sheet, is expected to
warm and lose ice while the other 98% gains ice.

Guess what?  Mr. Gore chose that little 2% to
illustrate his movie.  Was he ignorant of the choice he was making, or did
he know exactly what he was doing, telling the literal truth (that the
peninsula is melting) but leading viewers to the wrong conclusion overall about
Antarctic ice?

By the way, one last interesting
fact that frankly, scientists don't fully understand is the fact that the South
Pole is really not experiencing any warming.  While the warming at the
north pole exceeds the global average, the south pole shows little or no
anomaly.

         
   

 

Hurricanes & Tornados

Alter Hurricane Katrina, the media storyline focused
strongly on the role global warming may have played in increasing hurricane
power and activity.  Lost in the rush to blame global warming was the fact
that Katrina, when it made landfall, was not even a category 5 hurricane, and
its devastation was due more to  a city sited below sea-level that did a
poor job of managing its storm protection.

In fact, many hurricane experts do not agree with the argument
that warming oceans can lead to more and stronger hurricanes.  In fact,
hurricane activity is more related to the difference in temperatures between
the cold and warmer waters, a difference AGW theory says should decrease rather
than increase.  So is there reason to believe hurricanes are on the rise
as global temperatures warm?  The answer, as shown below, seems to be no:

But what about storm damage?  It certainly seems like
recent hurricanes have resulted in far more economic damage.  And they
have, but for the simple reason that over the last several decades, Americans
have put billions of dollars of expensive homes and other facilities in
vulnerable Gulf and Atlantic coast locations.   Several years ago, Dr. RA Pielke and CW Landsea
(that can't really be the name of a scientist studying coastal strikes by
hurricanes) attempted to correct hurricane damage numbers for the density and
value of coastal real estate:

By this reckoning, it is hard to see any trend.

Another claim Mr. Gore makes in An Inconvenient Truth
is that 2004 was the most active year for tornadoes ever in the United States,
and that there has been a steady trend in increasing tornados as the globe has
warmed.

And certainly if you look at the raw numbers, you might be
worried:

But there is a little something Mr. Gore fails to
mention.  During this time period, from 1950 to 2000, the technology and
network for detecting tornados has improved vastly.  From the NOAA

With increased national doppler
radar coverage, increasing population, and greater attention to tornado
reporting, there has been an increase in the number of tornado reports over the
past several decades. This can create a misleading appearance of an increasing
trend in tornado frequency. To better understand the true variability and trend
in tornado frequency in the US, the total number of strong to violent tornadoes
(F3 to F5 category on the Fujita scale) can be analyzed. These are the
tornadoes that would have likely been reported even during the decades before
Dopplar radar use became widespread and practices resulted in increasing
tornado reports. The bar chart below indicates there has been little trend in
the strongest tornadoes over the past 55 years.

Oops!  In fact, tornado frequency seems to be falling
as temperatures warm.  Do you think this was another honest mistake, like
with Antarctica, or did Mr. Gore purposefully obfuscate the real story?

Temperature Extremes

Another argument is that global warming will lead to more temperature
extremes, particularly record sweltering highs.  That seems logical
enough, but Bruce Hall actually
compiled the data and found something interesting.  He created a data base
for each state which shows in what year that state's monthly temperature
records were set.   So for each state, he has the years when the
twelve monthly high temperature records were set (e.g. year of highest Arizona
Jan temp, year of highest Arizona Feb temp, etc.) and the years when the twelve
monthly low temperature records were set.  Here, for example, is his data
for Arizona:

Extremetempsarizona

So, for example, the record for the highest July temperature was set in 1905
at Parker, Arizona with a scorching 127 degrees.  The entry in his
database would then be Arizona-July:  1905.  He notes that there is a
bias in the data toward more recent years, since if the record was set in 1905
and tied in 1983, only the newer 1983 date will show in the data.  I would
also observe that this data is uncorrected for urban heat island effects (as
cities urbanize they get hotter, and effect that is different than CO2-cause global
warming and is usually corrected for in global warming studies).  There is
also a bias towards the present in having more measurement points today than
100 years ago:  More measurement points means that, over a state, one is
more likely to pick up the true high (or low).

Though I have
other problems with the anthropogenic global warming hypothesis
, I have
never really doubted that the world has warmed up over the last century.
So even I, a skeptic, would expect a disproportionate number of the all-time
high temperatures to be in the last decade, particularly without UHI correction
and with the bias discussed above.  The global warming folks would argue
that the effect should be doubly pronounced, since they claim that we are
seeing not just a general heating, but an increase in volatility (ie more
extreme variation around the mean).

But Hall doesn't find this when he graphs the data.
Take the 600 state monthly high temperature records that exist on the books
today (50 states times 12 months) and graph the distribution of years in which
these records were set:

Assuming about 120 years of data, you should expect to see a high
temperature record on average in a database of 600 records at 5 per year, which
is precisely where we have been of late and well below the record years in the
thirties (remember the dust bowl?) and the fifties. It seems to actually show a
reduction in temperatures or volatility or both.

This may seem impossible "“ how can the mean increase without causing a lot
more new highs?  But remember what we discussed earlier "“ global warming
is expected to be seen disproportionately in nighttime and winter
temperatures.  This means that the mean can increase even as daytime
summer highs don't increase much.  In a sense, is the lows, not the highs,
that are getting higher.

Vincent et al in 2005 did a study of temperature trends in South America
from 1960-2000.  What they observed is exactly what we discussed
here:  The number of warm days and cold days did not really change.
The warming trend showed up as a decrease in cold nights and an increase in
warm nights, meaning effectively that the diurnal (across 24 hours) temperature
variation is narrowed. 

It's a little hard to be scared by this.

Extinction and Disease

Biologist Josef Reichholf was
interviewed recently in der
Spiegel
.  He is a strong conservationist, and certainly has his axe to
grind with industrial society.  In fact he blames industrial agriculture
and modern development for problems that species face. 

Many species are certainly
threatened, but not by climate change"¦.Many species have already fled from the
countryside to the cities, which have been transformed into havens of
biodiversity. We are also seeing another interesting phenomenon: Major cities,
like Hamburg, Berlin and Munich, have formed heat islands where the climate has
been two or three degrees warmer than in the surrounding countryside for
decades. If higher temperatures are truly so bad, why do more and more animals
and plants feel so comfortable in our cities?

On the contrary, there is much to
be said for the argument that warming temperatures promote biodiversity. There
is a clear relationship between biodiversity and temperature. The number of
species increases exponentially from the regions near the poles across the
moderate latitudes and to the equator. To put it succinctly, the warmer a
region is, the more diverse are its species.

OK, but what about those polar bears?  We have all seen
the media pictures of bears stranded on blocks of ice, as if all the arctic has
melted out from under them.  Well, it turns out that polar bears have
survived much warmer conditions.  We know polar bears existed as a
separate species at least 125,000 years ago, and in the intervening years,
there have been periods where Arctic sea ice melted completely during the
summer months.  And yet polar bears still exist today.  Polar bears
may be threatened by man's hunting and encroachment on its hunting grounds, but
not likely by our fossil fuel combustion.

AGW fear-mongering also extends to breathless predictions of
increases in "tropical" diseases.  Reichholf also takes on this canard:

Many people truly believe that
malaria will spread as temperatures rise. But malaria isn't even a true
tropical disease. In the 19th century, thousands of people in Europe, including
Germany, the Netherlands and even Scandinavia, died of malaria, even though
they had never gone abroad. That's because this disease was still prevalent in
northern and central Europe in previous centuries. We only managed to eliminate
malaria in Europe by quarantining the sick, improving hygiene and draining
swamps. That's why I consider it virtually impossible that malaria would return
to us purely because of climate change. If it does appear, it'll be because it
has been brought in somewhere.

Most of the world's leading tropical disease experts tend to
agree with Reichholf.  In fact, I would argue that diseases like Malaria
are not diseases of the tropics but diseases of poverty and
under-development.  Malaria is prevalent in Africa not because Africa is
hot but because Africa is poor.  Asian tropical countries that have developed
substantially over the last several decades have also greatly reduced
malaria.  In fact, as I will discuss in later sections, by reducing world
economic growth and slowing development in the third world in the name of CO2
reduction, we will actually increase rather than reduce these diseases.

Collapse of the Gulf Stream and Freezing of Europe

One of the recent hysteria's has been that global warming
will cause the Gulf Stream to collapse as Atlantic circulation patterns are
radically altered, thus leading to the freezing of Europe.  More sober
scientists have since essentially said "nevermind."  The Gulf Stream and
Atlantic circulation patterns are far more robust than this theory assumed,
and, even if the Gulf Stream changes, proponents of the theory were
overestimating the dependence of Europe on Gulf Stream warming.

Non-warming Effects of CO2

Interestingly, we may eventually decide that other
non-climate effects of CO2 production actually present more tangible
environmental threats.  In particular, recent studies have shown that more
atmospheric CO2 is causing the PH of ocean surface layers to drop (ie become
more acidic) leading potentially to coral kills and substantial changes in sea
life.  At the same time, physicist Freeman Dyson argues that stratospheric
cooling from man-made CO2 is much more a problem than surface warming, and is
much more measurable and provable.  These topics are beyond my scope at
this point, but something we may see more of in the future.

The table of contents for the rest of this paper, . 4A Layman's Guide to Anthropogenic Global Warming (AGW) is here Free pdf of this Climate Skepticism paper is here and print version is sold at cost here

The open comment thread for this paper can be found here. 

How's That Welfare State Working Out For You

Note: Lots of updates at the bottom

We have all heard that the US is backward vs. our much more enlightened bretheren in Europe on income inequality.  The general argument is that US is somehow a worse place because out income inequality is higher than in most European countries.

My reaction has always been, so what?  Why should I care about how well I am doing vs. the richest folks.  Shouldn't I care more how I am doing on an absolute scale?  And in fact, on an absolute scale, our poor are doing better than everyone else's poor, and better than many nation's middle classes.  I thought this analysis of poverty was interesting:  It is the number of people (per million) in a county living on less than $11 per day  (lower number and rank is better)

Per Capita Population Under $11 per Day

Poverty1

So, nations of Europe, how is that welfare state working out for you?  Socialist paradise Norway is 20 times worse!  How long will your poor be happy being told that, well, yes, the poor in the US are better off than you are, but you should feel better, because our rich in Europe are doing much worse than the rich in the US.

PS- Stats from NationMaster.com, a database of country by country statistics of all sorts.  Cool site, which also has a state by state counterpart.

Update:  Now that I have had time to poke around, I cannot find this data in the sources quoted, so it must be considered potentially suspect.  The sources quoted actually try to make the point that US lags Europe in fighting poverty, so the conclusion of the chart above is not even consistent with the sources.  (my guess is the data comes from the Luxemburg Income Study). However, it is interesting that this source material makes the same mistake I am trying to correct for here:  That is, it defines poverty as a percentage of the median income in the particular country, rather than an absolute value, such that a country can have poor who are better off but still fail on the metric.  You can see that here, where US has high poverty as on a "percent of median income" definition, but since we have the highest incomes in the world, it effectively gives the US the highest poverty bar to clear.

Here is what I am looking for:  Ideally, I would like to find a comparison of the median income say of the bottom quintile of each country, compared in absolute dollars on a PPP basis across countries.  I would like to see the number both before and after government transfer payments.  Europe, in their welfare economies, do better on poverty metrics when government transfer payments are included (and I am almost sure the chart above is before government transfer payments).  However, I would argue that for the long term health of the economy, you would like to see how the poor are doing before these payments.  Ultimately, and I will borrow a bit of environmentalist language here, this is going to be the most sustainable economy, where the poor gain wealth on their own, not from the welfare system.  In fact, the welfare state, and this was my original point, actually suppresses self-earned income of much of the poor by eliminating the incentive to work.  That is why I still think the chart at the top may be correct.

Update #2:  One other difference between the US and European nations is that we are much more open on immigration (yes, it may be illegal, but we pretty much still allow it).  These immigrants, legal or not, are counted in our economic and poverty stats.  If we assume there are about 15 million mostly poor illegal immigrants, plus millions of other quasi-legal immigrants, plus millions more who got amnesty in the 1980's, these immigrants add at least a fast five percentage points to any poverty metric the US is measured on. 

I have been surfing tonight, and it seems there are a ton of studies showing that US poverty is growing for some reason.  Duh.  Tens of millions of absolutely poor people, mainly from south of the border, have come to the US over the last several decades.  It is no secret all these immigrants are poor -- that is why they are coming here, to find something better for themselves.  Of course we have had a surge in poverty - we have been importing it like crazy!  I happen to be pro-immigration, but I am fed up with these studies that try to pin the blame on growing poverty in the US on government transfer payment policy.  It's the immigration, stupid!  Several studies particularly lament the fact that childhood poverty is rising in the US.  Can anyone think of a way this might be correlated to tens of millions of strongly Catholic Mexican immigrants, each and every one committed to large families?

It's Our Economy, Not Yours, Stupid

Like many libertarians, I lose interest quickly in politics, watching partisans of the Coke party argue why they are so much different than the Pepsi party.  You don't have to watch the whole farce for very long as a neutral observer before you see the same people taking the opposite tack on an issue than they did a few years earlier, only because their guy is in office, so now its more OK than when the other party's guy was doing it.

But I do read a few political blogs from both sides, just to keep abreast of what is going on.  This weekend, both sides managed to irritate me over the same issue.  First, Kevin Drum, from the left, railed on what he called "the GOP economy," complaining that the economy has grown without increasing median wages (note he carefully avoids "total compensation," which has gone up.)  Then Captains Quarters wrote from the right that "The economy continues its growth under the stewardship of the Bush administration."

George Bush does not run the economy.  George Bush does not even make day-to-day decisions that affect the economy.  He has made a few major moves that have economic consequences, with the positive effects of tax cuts probably mostly offset by unrestrained deficit spending, random protectionist acts and new bloated government services.  Bill Clinton, while we have to credit him for NAFTA (see below), was not responsible for the incredible economic expansion of the 90's.  In fact, neither Bill Clinton nor his wife have ever held a job where they produced anything. 

All of which is fine - I am not accusing president's of somehow falling down on the job.  I am merely stating what I thought was obvious.  Wealth is created by the actions and the minds of hundreds of millions of people, to whom the occupant of the White House is largely irrelevant except insofar as the President  substantially increases or reduces the artificial burden of efficiency-sucking government mandates, reporting, and taxes.

I will go into more depth on this in my annual tax day post, but I am increasingly confident of my theory of wealth creation.  Wealth is increased as two things happen:

  • More individuals are more free to (and more likely to) question established beliefs, either scientific (e.g. the earth-centric universe), social (e.g. racial prejudice) or business (e.g. primacy of mainframe computing).
  • More Individuals are more free to act in their own self-interest to pursue the results of their insights and to keep for themselves the proceeds of their efforts.

Since the 1970's, we have seen an explosion in the global economy, which has greatly increased the number of people working on any given economic problem.  For example, instead of just people in Detroit and Germany thinking about how to design and produce cars, we have folks in Japan and South Korea and even China and Brazil questioning the established wisdom from Detroit.  This has resulted not just in better, more affordable cars, but in production and supply chain management techniques that have made nearly every industry you can name more productive. 

Whenever such a change occurs, there are conservative (lower-c) forces that try to halt them.  The Church used its power for a time to resist the heliocentric view of the solar system.  Southern states used Jim Crow laws to resist post Civil War racial and social reforms.  And any number of groups wanted (and still want) to slam the door on the global economy.  Many countries in Europe went down this path.  What has saved the US from the same low-growth fate they have in Europe (and Japan) is that the government, and Bill Clinton in particular, at a critical time resisted the technocratic urge to have the government "do something" about the economic changes flowing from globalization.  Some wanted protectionism, while some wanted a more active hand by the government in "choosing winners" in the economy, like it was perceived that Japan had.  Bill Clinton resisted resisted these voices, most of whom were powerful in his own party, and in fact doubled down on globalization by pushing NAFTA.  For this act of vision, Clinton should be credited, but I still wouldn't call it "his" economy. 

My Health Plan Is Now Illegal In Massachussetts

Yesterday, I posited that current proposals for government health care are worse than other welfare programs, because they not only will cost a ton of money, but they will also, unlike say government housing, make my personal health care worse.

I only had to wait one day for an example
(actually, I didn't have to wait at all, since I could just mine Europe and Canada for examples).

Massachusetts has now set the minimum level of insurance required to
comply with the state's individual mandate. Not only will every
resident of the state be required to have insurance by July of this
year, but by January of 2009, no one in the state will be allowed to
have insurance with more than a $2,000 deductible or total out of
pocket costs of more than $5,000. In addition, every policy in the
state will be required to cover prescription drugs, a move that could
add 5-15 percent to the cost of insurance plans.

After a lot of study, my family chose a high deductible health plan combined with a medical IRA (they actually call them something else, but I can't remember the abbreviation).  We had a low deductible plan, but ran the numbers, and found we would save tons with a higher deductible plan, particularly if we dumped the savings into the IRA.  We set the deductible at the level of economic pain we thought we could bear in a bad year.  Even if we had a medical disaster once every three years, we would still be ahead with the lower premiums and the IRA-style tax savings.  And if we don't have a disaster that frequently (we never have had even one in our lives) then we will build up some nice savings for retirement.

Of course, this makes too much sense to be legal.  It actually involves individual choice and stuff, and god forbid we be allowed to exercise that.  For our own good, of course.