20 July 2011

Missing the Point

Paul Krugman posts videos from time to time on his blog that he thinks...well, for some reason Paul Krugman will post a video on his blog and tonight he picked "Don't Give Up" by Peter Gabriel and Kate Bush.

I can't know this for sure, but there is a very good chance that I have listened to this song more than any other human being alive. I know it was written about a man facing economic uncertainty. But the message of the song is, quite obviously, that one shouldn't give up. It is a testament to the resiliency of the human spirit and an homage to the beauty of friendship.

Press on in the face of hardship...

don't give up
'cause you have friends
don't give up
you're not the only one
don't give up
no reason to be ashamed
don't give up
you still have us
don't give up now
we're proud of who you are
don't give up
you know it's never been easy
don't give up
'cause I believe there's the a place
there's a place where we belong

Pretty simple and yet powerful. And beautiful.

Which is why it is very weird that it is used by someone of the likes of Paul Krugman. You see, you don't need an indomitable spirit or friends and family to love and support you when you're down. In Krugman's universe, the government is just a giant insurance company with an army, not an institution created by men to insure their rights to life liberty and the pursuit of happiness (which includes the pain and learning brought by failure).

In his world, it is not the "us" who support you and your friends and family who know and love you and care about you. It is the collective "us", who support you because, well, if we don't buck-up when the hat comes around we're going to end up in jail.

It is the compassion and support that is done by the force of law that is so beautiful.

So don't give up...because there are some rich people out there who have too much of their own money. We're going to take it from them and make everything all right.

19 July 2011

It's Not a "Liquidity Trap"

It is government interference in the market. Very well put here by Steve Wynn:

18 July 2011

Unrealistic Spending Limits

So among the back and forth between the Republicans and Democrats of raising the debt limit, it appears the Republican led House will pass a bill this week that President Obama has promised to veto.
Because, according to the article "the legislation would 'lead to severe cuts in Medicare and Social Security' and impose unrealistic limits on education spending. (emphasis added)

The federal government is out of money. And $14,290,000,000,000 in debt. Which isn't enough debt, which is why we are having this discussion to begin with. So under the circumstances, there really should be no such thing as an unrealistic spending limit on anything. Much less education, which is a) the responsibility of the states and local governments if it is the concern of the state at all, and b) not the responsibility of nor an authority granted to the federal government.

And it shows how far we've come when the problem is that the president is concerned about spending too little.

Good grief.

Yet Another Reason to Hate Hitler

Larry Summers on the Charlie Rose show (≈21:50):

Never forget, never forget, and I think it’s very important for Democrats especially to remember this, that if Hitler had not come along, Franklin Roosevelt would have left office in 1941 with an unemployment rate in excess of 15 percent and an economic recovery strategy that had basically failed.

So, yeah...Hitler was a douche.

Another hat tip to Greg Mankiw.

17 July 2011

Stand Up Economist

Hat tip to Greg Mankiw

11 July 2011

War is Peace; Freedom is Slavery; Ignorance is Strength


Medicare Saves Money

I'm just going to cut to the chase on this one. Professor Krugman notes that Medicare "spending per beneficiary" has risen 400% from 1969 to 2009 adjusted for inflation. He counters this with the "inflation adjusted premiums" on private insurance which has increased 700% over the same time period.

  • Notice he conflates "spending per beneficiary" with "private insurance premiums." Apples to apples would be spending per beneficiary of a patient with Medicare compared to a patient with private insurance. That's not what he's comparing and it is, at best, deceptive.

  • He fails to mention that any costs for patients that will not be covered by Medicare are passed along to other patients. Not that this should ever be a problem because states are complicit with health care providers to defraud the federal government (that is, us) to keep the money flowing.

  • Most importantly, private health insurance premiums are paid for by the individual and the firm he works for, whereas Medicare spending per beneficiary is a wealth transfer scheme, paid for by other people with money taken by the federal government under pain of imprisonment.

Professor Krugman is a disingenuous snake.

Parsing Time

President Obama is engaging the Republicans in a game of chicken over the debt ceiling, insisting that tax increases be part of any deal. Regardless of the fact that back in 2009 he said, “the last thing you want to do is raise taxes in the middle of a recession because that would just suck up – take more demand out of the economy and put business further in a hole.” Which is similar in reasoning to something I posted right before he said it.
Now, just to clarify where I stand on a few things: restoring the marginal tax rates to pre-W levels is, in fact, a tax increase (even if it is only on those rates paid by those bastards who just have too much damn money). Whether you wrap it in the language of "letting them expire" or whatever else. If the government takes 35% of the money you earn over $379,150 in 2011 and then the next year the government takes 39% of that money, you are paying higher taxes. The government has effected a tax increase. Period. Full stop.
But the Republicans are playing a little fast and loose with the definition of "tax increase" themselves. Some Republicans, apparently under the sway of a little gnome named Grover Norquist, have said that eliminating tax subsidies, specifically those enjoyed by oil and gas companies, is the same thing as a tax increase. No, it isn't. Any special cut away for any firm or industry for whatever reason creates market distortions and inefficiencies. Yes, it is more efficient for a firm to spend its own money the best way it sees fit, but it is inefficient (along with unfair and immoral and it rightly gives the impression of bribery) for any firm or industry to be given any special favors regarding taxation by the legislature. Even if everyone thinks it's a good idea. This goes for oil companies, agribusiness, sugar producers, colleges and universities, mortgage holders. Everyone.
Now these are not "loopholes," they are intentional favors enacted by congressmen of both parties. For a fuller, and better, exposition on this matter please see this post by Kevin Williamson.
I really don't care how this is settled, because it will be a deal between and among politicians and the only ones who will end up getting screwed will be the rest of us.
This post was to be a lot longer, but I'm tired.
And Joe Biden is still an ass.