Ban Everything!

This Buckyballs controversy raises several interesting questions about how far government should go to protect consumers.

I want to draw attention to Betty Lopez's statement, though. She says "Any child's life is worth more than $50 million."  This is one of those statements that is hard to dispute without sounding callous, but let me try the ad absurdum approach.

Do you think Betty Lopez has a number where she would no longer make this statement?  Do you think she would say, "Any child's life is worth more than $1 billion"?  I can imagine her saying "No amount of money is worth a child's life."  Which is true in a sense.  Anyone willing to sell their child for any amount of money deserves scorn.

However, think of all the lives we could save by banning bicycles.  In essence, you're arguing Buckyballs' case.  We don't want to ban bicycles because the benefits of bicycles are much greater than the regretful children's deaths.  We've already made those decisions.  Any activity can lead to death, but that's not the argument we should make.  We should compare the benefits and costs of banning and regulating.  Ms. Lopez's statement is much too universal for me.

Congress's Selective Polarization

Peter Orszag argues that the Postal Service should be privatized.

I wholeheartedly agree. There's really no reason for the government to provide a service that the private sector has demonstrated that it can easily handle (Fed Ex, UPS).

I also agree that if people are worried about service to rural areas, I'd be willing to discuss some kind of subsidy for them only.

I want to draw attention to his opposing arguments, though. He has provided what he believes are the best counter-arguments to his proposal and attempts to dispel them.

Congress could simply unshackle the agency. Legislation is currently pending in both the Senate and the House that would give Postal Service management additional flexibility. In an increasingly polarized Congress, however, it is not clear if or when this legislation will be enacted. And even if it were passed soon, it would probably provide only temporary help. 

Wait, so we can't settle for relaxing the burdens on the postal service through legistlation because the political process is stymied, but how exactly will the postal service be privatized?  Don't we need legislation for that as well?  Will the same political process that is too polarized to provide management extra flexibility magically hold hands and usher through the privatization?

A Rambling, Incoherent Mess III

Apparently, I'm not the only one who was bothered by this speech.  Some have even pointed out how poorly constructed it is.  But I'll push on anyway.

In Part III, we look at this paragraph.

If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business -- you didn’t build that. Somebody else made that happen. The Internet didn’t get invented on its own. Government research created the Internet so that all the companies could make money off the Internet.

In the first three sentences, President Obama seems to be echoing John Donne.  Have you ever heard anyone argue that any rich people have never interacted with another human being, either directly or indirectly?  Of course everyone had teachers, of course, they must have purchased something at some point manufactured by someone else.  These points are not in dispute!  It's another Obama strawman.

Then he transitions from interactions with private citizens to interactions with groups.  Notice, first it was 'you had a teacher,' then 'you used roads.'  Then, the great leap.  Because you've used resources that others provided, you accomplished nothing.  You deserve no credit for what you've done with those resources.  The people who provided the resources deserve the credit. 

Keep in mind that many of those resources were privately provided, too.  The takeaway must be that all products, all innovations are ultimately because of roads and bridges and teachers, things provided by government.  The government is responsible for everything in our lives.  One could make the argument that nothing in government would be possible without successful people paying taxes, which is also true but completely contradictory.

The point is that these resources provided by the government are generally equally available to all citizens.  But it's select citizens who are smart, work hard, and sometimes inspired that take those resources (along with goods and services provided by the free market) to offer a new product and service that everyone else values.  This is how they become successful.

Lastly, the government did not create the internet so that businesses could make money off of it.  The Department of Defense created the internet to aid their communications. Businesses saw the potential of the internet and invested in it, developed it, and profited from it.  If corporations had not invested in the internet, there would be no internet, I doubt its potential could have been realized.

Alternatively, if the government hadn't invested in the internet, I believe it still would have eventually developed. It was too profitable not too, and the idea wasn't so complicated that no one would have thought of it.

Hypocritical Outrage

Perhaps you've heard that several leading Democrats are outraged that the US Olympic team is wearing uniforms manufactured outside of the US.  To make matters worse, they were manufactured in China!  Oh the humanity!

Greg Mankiw rightly points out that it's very likely that the very people complaining are probably themselves wearing clothes manufactured outside of the US.

I'd like to take this point several steps further.  Every Democrat that has complained about this situation, should be challenged to purchase only products manufactured in the US.  No foreign cars, clothes, electronics.

This will include Harry Reid, Nancy Pelosi, Sherrod Brown, Kirsten Gillibrand, and Bernie Sanders.

Below are quotes from these hypocrites.  I encourage you to replace 'Olympic Uniforms' with any product conceivable.

“There is no reason why U.S. Olympic uniforms are not being manufactured in the U.S. This action on the part of the U.S. Olympic Committee is symbolic of a disastrous trade policy which has cost us millions of decent-paying jobs and must be changed.”

-Bernie Sanders

“We have people in America, in the textile industry, who are desperate for jobs. What the Olympic Committee did is absolutely wrong.”

-Harry Reid 

A Rambling, Incoherent Mess II

Part II in the analysis of this speech.

Let's take the remarks in blocks.

...if you’ve been successful, you didn’t get there on your own. You didn’t get there on your own. I’m always struck by people who think, well, it must be because I was just so smart. There are a lot of smart people out there. It must be because I worked harder than everybody else. Let me tell you something -- there are a whole bunch of hardworking people out there.

I suppose President Obama is suggesting that the successful people he knows, when asked to explain their success, propose it is either because they are smart or they work hard or some combination of the two. President Obama then argues that it can't be because they are smart because "there are a lot of smart people out there." Is that an argument? Intelligence can't explain success because many people are intelligent? Does he mean that there are many intelligent people out there who aren't successful?
I think most intelligent people are successful. I'd like to see data that refute that. I'm sure some intelligent people make bad choices or have bad luck, but by and large smart people enjoy successful lives. Is President Obama really "struck" by people believing that they owe their success to intelligence? Isn't one of the main objectives of the Democrat Party to increase access to education? If intelligence doesn't promote success, why bother with education?

Maybe he meant the super-successful can't explain their degree of success with intelligence alone. That may be true; many of the most successful people out there aren't the smartest people in the world. But I don't think they would submit the intelligence answer in the first place. Steve Jobs would be a good example. He was successful not because he was smart but because he had a sense of what consumers wanted and provided revolutionary products. By doing so, he both enriched himself and served consumers. If someone asked him to explain his success, do you really believe he would have said it was due to his intelligence?

I also don't think people would answer "because I worked harder than everybody else." Most people realize that there's an upper limit to how hard you can work, and many people hit that limit with little success. I'm confident that most successful people realize that. This is just another example of President Obama building straw men so that he can knock them down.

Most successful people do work hard. Many people who are not successful also work hard. Hard work alone does not explain success. Only in President Obama's mind (or speeches) does anyone argue differently.

Bizarro World of Welfare Reform

I've been trying to follow this Welfare Reform Issue.  I'm still not sure I totally understand both because it's kind of complicated and neither side has really comprehensively explained what's happening.  This is what I believe: Utah and Nevada want the Federal Government to relax some of the work requirements included in Welfare Reform.  These are the provisions that ensure that people who receive welfare are not just lying about watching TV.  They say, not that they want to allow this kind of sloth, but they want to be able to have their own definitions of work (like going to school).  The Obama administration replied it was willing to consider granting waivers if more information is given.

Cynical conservatives believe the Obama Administration is doing this to weaken the work requirements, while the Obama Administration claims it is trying to provide more flexibility but maintain the spirit of the law.

I guess only time will tell who is correct, but this story has two passages I find extremely interesting.

The first is a quote from George Sheldon, acting Assistant Secretary for the Administration for Children and Families at HHS. "Federal rules dictate mind-numbing details about how to run a welfare-to-work program. Many states report that their caseworkers are spending more time complying with federal-documentation requirements than helping parents find jobs."

Have you ever heard a Democrat decry a regulatory burden.  When Republicans complain about too many regulations choking the economy, generally, there's no response from Democrats.  Probably because Democrats believe in regulations but they poll poorly.  Maybe Democrats have decided regulations that restrain the private economy are good, but regulations that restrain the public sector are bad.

The article's authors, Louise Radnofsky and Janet Hook say "The outcry was a shift for Republicans, who have traditionally pushed for states to have greater control over how they spend federal dollars. The Obama administration has tried to portray many of its policies as giving states more latitude."

This is very interesting. I county myself as someone who "traditionally pushes for states to have greater control over how they spend federal dollars." How can I reconcile this seeming discrepancy?

If I'm pro-federalism (which I am), and anti state to state redistribution of taxes (which I am), then how can I disagree with these waivers? Well, if the Obama administration is sincere in wanting to relax the specific requirements but maintain the general work requirement, then I completely agree with what they're doing. Conservatives are worried that they are just using this as an excuse to increase the size of the program by increasing aid to those who don't work.

A Rambling, Incoherent Mess

I don't know if this speech was pre-written and read from a teleprompter or if President's Obama's remarks are extemporaneous.  What I do know is that this argument is poorly constructed.

It has three paragraphs; here's an outline of the argument.

• People aren't successful because they're smart.
• People aren't successful because they work hard.
• Successful people interacted with other people on the way to success.
• Successful people used communal infrastructure on the way to success.
• Example: The government created the internet.
• Successful people are successful because they have individual initiative and they work together.
• Example: Fire fighters work together.

I can't see how this meandering argument can do anything but create an impetus for applause.  Each point seems designed to engender an applause from a mindless audience.  'We work hard, we're smart and we're not very rich!  These rich people owe their success to us! Of course firefighters work together!'

In subsequent posts, I want to dissect this argument point by point.

What's Good Enough for Them

In Friday's edition of Left, Right, and Center, the representative for the Left, Robert Scheer was asked whether Obama or Romney was helped by the Supreme Court decision.  Robert Scheer's response (presented as a question directed to Romney by Obama)

(starting at 16:30) What you did for Massachusetts I did for the rest of the country. How could you disagree with that? How can you call that socialized medicine? How can you say that's an unfair intrusion into people's lives? If it was good enough for the people of Massachusetts, why is it not good enough for the rest of the country? And I've extended it to 30 million people. I think that's an argument Romney loses. I don't even know what the answer is.

The Right's representative, John Eastman, gave a political answer: it raised taxes, it takes away freedom, etc. Maybe the philosophical response doesn't poll well, but I wanted to make sure that people realize that people like me have a much stronger answer to this question.

The answer is that the people in Massachusetts aren't necessarily representative of the people in the rest of the country.  Whatever is the best solution for Massachusetts may not be the best solution for the nation as a whole.  That's why people like me are strong advocates of federalism.  Letting each state find its own solution.  A national solution for a problem as complex as health care will never be as optimal as different solutions tailored to different populations of the country.

Simultaneously a Tax and Not a Tax

There are several aspects of the Supreme Court's decision on the ACA that still perplex me.

What exactly is the difference between a tax and a fine?
Don't taxes have to be paid before they can be challenged?
Don't taxes have to begin in the House of Representatives?
What is the explanation for the Medicaid decision?

I find reading the direct opinions can be very illuminating.  For example, I read the Conservative bloc's opinion, and came away with the realization that really they made a very strong case that Congress believed the mandate was not a tax, but not such a strong case, that it Constitutionally wasn't a tax.

Today, I think I can answer the second question.

This issue is discussed by Chief Justice Roberts on page 11 of his opinion (17 of the pdf)

It seems the answer to why this is not a tax for the purposes of the Anti-Injunction Act but is a tax for Constitutional Purposes is that the Anti-Injunction Act was written by Congress.  So it applies only to things that Congress thinks is a tax.

It would be like if you and I had different definitions for the same thing, say a computer.  Then I said I will buy you a computer.  Do you expect what you consider a computer, or do you expect that I give you my version of a computer.

Since Congress passed the Anti-Injunction Act, and said taxes must be paid before they can be challenged.  Then they wrote the ACA which calls it a "penalty," so the Anti-Injunction Act doesn't apply to it.  I'll try to think of an analogy to make this clear.