Who Pays More Income Taxes: The Top 1% or the Bottom 95%?

I've blogged about this before, but here is some updated data from the IRS, via the Tax Foundation, on the topic: Tax Burden of Top 1% Now Exceeds That of Bottom 95%. Not only is that now true about income taxes, but it has been trending this way for some time: from 1987 to 2007, the bottom 95% share's of total income taxes has fallen from 58% to 39.4%, while the share of total income taxes paid by the top 1% has risen from 24.8% to 40.4%. What this means is that the top 1.4 million taxpayers pay a larger share of the income tax burden than all of the bottom 134 million taxpayers combined.

Don't Wash Those Vegetables, or the Government Will Get You!

Read this ridiculous posting for another story of government regulation's strangling business -- this time your loveable local farmer who sells veggies at a farmer's market. Apparently they aren't allowed to wash the vegetables, even if they don't label or package them in any way that indicates they have been washed. They must be sold dirty, as dirty as they came from the field. Wow.

On Obama's Big Re-Regulation Speech Today

At the risk of redundancy -- since I sent bursts of opinion on this to my Facebook friends and Twitter followers today as well -- here are a few thoughts I had while listening to Obama's big speech today announcing his intentions to re-regulate the financial industry:

• We'll see how many of his proposals make it through Congress. But one question I have now: how will more regulation lead to less fine-print in mortgages and credit card paperwork? When has more reg ever had that result? Take prescription drugs for instance -- see the magazine ads!
• Mark calendars for 5 and 10 yrs from today (Obama re-regulating financial industry): did this make things better or worse? and for who? and what "unintended", negative side effects will this produce? There always are some from such sweeeping gov. moves.
• Really, Mr President? Really no mention of the biggest cause of the bubble and problems that followed: Fed easy money policy. Nope, no one in DC wants to criticize the Fed. Instead, more power begin given to the Fed! (Sigh...)

Blame Beyond GM's Management

Alex Epstein has written two good blog posts critical of the notion that the primary blame for GM's problems should be attributed to GM's poor management over the years. See his posts:

• The elephant -- and the Donkey -- in the room (part 1)
• The elephant -- and the Donkey -- in the room (part 2)

In this second posting he recommends the writings (on this subject) of Holman Jenkins of the WSJ. He excerpts the following gems from a recent Jenkins article:

Why don’t the auto makers limit themselves to paying competitive wages and benefits in line with what workers could earn elsewhere? Because, in the 1930s, Congress passed the Wagner Act with the nearly explicit purpose of imposing a labor monopoly on Detroit to keep wages at higher-than-competitive levels.

Why doesn’t Detroit rationalize its musty brand lineups and dealer networks? Because, in the 1950s, legislatures across the country imposed franchising laws, including the federal “dealer day-in-court clause,” to make such rationalization prohibitively expensive.

Why don’t the auto giants do as Whirlpool and other manufacturers have done, and move their production to cheaper offshore locales? Because, in the 1970s, Congress enacted fuel economy rules to penalize homegrown auto makers if they don’t build the lion’s share of their cars in high-wage, UAW-staffed domestic factories.

Golisano Shrugs

Sound like Atlas Shrugged, anyone? Tom Golisano, one of the richest men in New York, is fed up with the state government and its continuing policy of raising taxes to spend, spend, spend. After many failed attempts to get elected so he could try to reform the state government, he is now fed up... and is leaving. He will take up residence for most of the year in Florida instead of New York, and therefore avoid paying millions to the wasteful NY bureaucracy.

This article at Cato includes Tom's own words on this matter: The Laffer Curve in Action.

I say, good for you Tom! Too bad more of us aren't in a position to make such a move. Maybe if enough businesses and individuals do so, leaders in Albany would start to make some real changes.

On Ethanol

I've seen an increase in articles lately critical of Ethanol. Here is a recent one (split into three pages) from BusinessWeek: "The Great Ethanol Scam". This particular article mostly concentrates on the apparent damage that the blend does on some car parts, though there are of course far more fundamental reasons to criticize the ethanol mandates. What the combination of government, environmentalists, and some select corporations have done to push ethanol on us all is is an outrage to say the least.

On New York's Taxes

I'm a little late commenting ont his, but there was a really good opinion piece in the April 11 issue of the WSJ: The Tax Capital of the World. The focus is on New York and the proposed increases in taxes. First we learn of the plans to further tax the "rich", who in New York are dwindling at a faster rate than elsewhere in the country given the slam that Wall Street in NYC took late last year. The article also notes that the richest 1% of New Yorkers already pay almost 40% of the income tax, and the top 0.5% pay 30%.

Speaking of State Assembly Speaker Sheldon Silver, the article later ends with these four paragraphs:

Mr. Silver says of the coming tax hikes: "We've done it before. There hasn't been a catastrophe." Oh, really? According to Census Bureau data, over the past decade 1.97 million New Yorkers left the state for greener pastures -- the biggest exodus of any state. New York City has lost more than 75,000 jobs since last August, and many industrial areas upstate are as rundown as Detroit. The American Legislative Exchange Council recently said New York had the worst economic outlook of all 50 states, including Michigan. And that analysis was done before these $4 billion in new taxes. How does Mr. Silver define "catastrophe"?

Oh, and it isn't just high earners who get smacked. The new budget raises another $2 billion or so on top of the $4 billion in income taxes with some 100 new taxes, fees, fines, surcharges and penalties to be paid by all New York residents. There are new charges for cell phone usage, fishing permits, health insurance (the "sick tax"), electric bills, and on bottled water, cigars, beer and wine. A New York Post analysis found that a typical family of four with an income below $100,000 would pay more than $800 a year in higher taxes and fees.

This is advertised as a plan of "shared sacrifice," but the group that is most responsible for New York's budget woes, the all-powerful public employee unions, somehow walk out of this with a 3% pay increase. The state is receiving an estimated $10 billion in federal stimulus money, and Democrats are spending every cent while raising the state budget by 9%. Then they insist with a straight face that taxes are the only way to close the budget deficit.

And so Albany is about to make a gigantic gamble on New York's economic future. The gamble is that the state with the highest cost of doing business can raise taxes on everyone who lives, works, breathes, eats or drinks in the state and not pay a heavy price for it. If they're wrong, New York will enhance its reputation as the Empire in Decline State.

I've lived almost my entire life in New York, and still very much like where I live. But how much further down the road of "spend and tax" can our state go before it becomes unlive-able?

Henry Waxman's Scary Plans For Us

I find it hard to choose what items to bother mentioning at my blog, because there are just so many worthy items coming out of Washington. There are so many attacks on our rights, proposed schemes that will ruin the economy, and so on... where does one begin? Why mention this horrific idea over any other? I'll continue to somewhat randomly mention the ones that happen to catch my eye... like this item from the April 10th WSJ: Henry Waxman Has a Plan. The list of things his plan would further regulate includes roofing, furnaces, laundry machines, dishwashers, showerheads, faucets, water closets, urinals, jacuzzis, lightbulbs, lamps... and likely a lot more that the article doesn't bother to mention. Another day, another "yikes!".

Really? Getting a Ticket for Parking In Your Own Driveway?

Radley Balko reports on the latest insanity from Washington, DC: generating revenue by issuing tickets to people for parking their cars in their own driveways!

That is just so bizarre... it really sounds like a fake headline from The Onion. If this is true... one really has to ask... again... what will politicians do next?

Obama and Big Numbers: The Difference Between 100 Million and Several Trillion

Yet another great visualization of the numbers that are being tossed around in Washington these days: Obama Budget Cuts Visualization.

On Big Numbers and the Obama Budget

My friend Will Wilkinson's brief article Obama budget adds up to a big problem nicely summarizes many of the points I've been making lately to anyone who will listen. He notes the feebleness of Obama asking each cabinet area to cut $100 million, how such numbers are dwarfed by the number $3.5 trillion, and the obvious long term problem being that we will all have to pay for this spending spree at some point down the road -- through higher taxes or through inflation (a tax on money you already have). Well done Will!

Thomas Sowell on One Major Cause of the Housing Crisis

Thomas Sowell recently wrote a good essay focusing on one of the biggest causes of the financial crisis -- the unnecessary and economically damaging government emphasis and programs to try to artificially increase home-ownership. A good read.

Scary Debt Numbers

As a follow-up to my recent posting "Scary Deficit Numbers", see the graph that accompanies the March 23 WSJ editorial. These are the CBO estimates for the federal debt held by the public as a share of GDP if President Obama's 2010 budget becomes law. Notice it skyrocket from just over 40% to close to 60% in 2009, and then gradually increase to over 80% by 2019. Just yet another visualization of the enormous spending being proposed here!

Scary Deficit Numbers

See this graph from the Washington Post. The White House numbers are scary enough, but the independent CBO numbers are even more frightening. See Paul Hsieh's post at NoodleFood for some further comments on this.

I'd love to re-watch the many quotes -- from Democrats in particular -- the countless times they criticized the now relatively-puny-deficits from the past 8 years (particularly before they took over congress). Those quotes should play on a loop on some cable station me thinks.

And just keep in mind folks -- these numbers are the annual deficit numbers, which means they are cumulative on top of the already existing huge debt.

We'll soon need new adjectives here folks!

How Many Will Choose To Shrug?

Here is an interesting item... apparently a resignation letter from an AIG employee to their CEO. The most disturbing aspect of this is on page 2, where he notes "the only motivation" remaining for AIG employees: fear from politicians "naming and shaming" them. This letter, the events that prompted it... again, this is very reminiscent of Atlas Shrugged. I wonder how many other people -- at AIG or elsewhere -- will be as brave as Jake DeSantis and choose to "shrug"?

Coming Next? Make Them Stay at AIG

The blog Titanic Deck Chairs had a nice posting titled AIG Bonuses and Retention Contracts -- A Proposed Solution. Does this seem farfetched? I could see Barney Frank and the others at least suggesting this solution. I'd like to think there would be enough of an outcry from other legislators -- and the "American people" -- to keep it from happening.

Regardless, this was an interesting, provocative post, with a great reference to Directive 10-289, from Atlas Shrugged here!

Stossel on Bailouts and Bull

John Stossel gave a great 20/20 program on Friday, March 13. He covered a handful of topics, and these are available as separate videos on YouTube as follows:

• Part 1: Stimulus, Bailouts, and Crisis (7:46)
• Part 2: In favor of privatizing some of our roads (7:02)
• Part 3: Feds vs. States on Medical Marijuana (6:49)
• Part 4: On Universal Pre-K (6:17)
• Part 5: On the Border Fence (6:16)
• Part 6: America: The Land of Opportunity (6:45)

Good stuff!

WSJ Item on Rand's Relevance

I liked Yaron Brook's opinion piece that was published by the Wall Street Journal recently: Is Rand Relevant?

Glenn Garvin on Unions and Mortgage Bailout

Here is a good column about the "Orwellianly named Employee Free Choice Act", from Glenn Garvin of the Miami Herald: "No choice in Free Choice Act". This beginning speaks to a change of opinion by primary supporters of the act that I didn't know about:

If consistency is really the hobgoblin of little minds, then Hilda Solis and George Miller must be America's top ghostbusters. They think the secret ballot is the cornerstone of democracy, except for American workers deciding whether to join a labor union.

Miller is the U.S. House's chief sponsor of the Orwellianly named Employee Free Choice Act, a bill much-coveted by labor unions that would do away with secret-ballot voting when they're trying to organize a company workforce. And Solis, a former congresswoman from Southern California who is President Barack Obama's newly confirmed labor secretary, is EFCA's chief cheerleader.

Oddly enough, Miller and Solis used to think secret ballots were the very lifeblood of democracy. In 2001, introducing himself as someone ''deeply concerned with international labor standards,'' Miller wrote Mexican officials urging them to allow workers to vote on unionization with secret ballots.

''The secret ballot is absolutely necessary in order to ensure that workers are not intimidated into voting for a union they might not otherwise choose,'' Miller wrote, adding that the practice ''will help bring real democracy to the Mexican workplace.'' (The American workplace, I guess, is quite another matter.)

That is precious.

I poked around, and found this late February column he wrote on the mortgage bailout plan which was good too: Common sense missing in Obama bailout.

What Does $1 Trillion Look Like?

I've seen many images like this lately, and most don't do much for me. But this page's building up of images to show just how large $1 Trillion is... I find this series impressive.

Videos Opposing Detroit Bailout and Economic "Stimulus" Plan

Two good videos on YouTube:

• Opposing 'Stimulus' -- Hundreds of Economists Sign on to Cato Institute Ad -- From Cato
• Bailing Out the Big Three - Why reward Detroit (and punish taxpayers) for making unprofitable cars? -- From Reason, and includes at beginning/end some funny clips from SNL.

Government Again Pushing Banks to Make Bad Loans?

Bert Ely wrote a nice piece for the Feb. 2 Wall Street Journal titled "Don't Push Banks to Make Bad Loans". As always, Bert writes in a clear, concise fashion -- and makes a strong case that the federal government's recent actions are perpetuating their mistakes of the past.

Two Economists Against the Massive So-Called "Stimulus" Plan

My friend Will Wilkinson wrote an interesting piece, The Self-Defeating Stimulus, that provides the views of two nobel award winning Economists (Edward Prescott and Edmund Phelps) on the massive so-called "stimulus" plan from the Obama administration and the Democrats in congress. Good stuff!

Rick Santelli Is Angry About Government's Recent Actions

Rick Santelli of CNBC sparked a revolution of sorts on the floor of the Chicago Board of Trade. Watch the video to see! Pretty cool... also available on YouTube of course.

How big is 13 Trillion?

I got an email recently from CEI (Competitive Enterprise Institute), that asked the provocative question "How Big is $13 Trillion in Debt?". (I couldn't find the email as a press release or other article at their website, but I did find it reproduced here.) It begins with these interesting numbers:

Regardless of your political party or ideological leanings, the notion of the federal government spending $2 trillion, adding to the national debt of nearly $11 trillion already, should make you stop and consider the staggering size of our national tab.

If the irony of using debt-based spending to solve a problem caused by debt-based spending has escaped you (I doubt it has), perhaps these fun facts will put things into perspective:

• If you spent $1 every second, you'd have to keep spending for 412,000 years to get to $13 trillion. That means you'd have to start shortly after the time human beings first starting using stone tools and fire to get to $13 trillion today.
• $13 trillion in one dollar bills weighs 28 million pounds. That's as much as 87 blue whales or 462 Statues of Liberty.
• If you laid 13 trillion one-dollar bills end-to-end they'd reach from the earth to the sun and back...five times over. That's 946 million miles of greenbacks.

It then continues on to talk a bit about the $2 trillion bailouts figure, and also the big number that amounts to the amount of interest we are all paying on the debt.

Latest Eminent Domain Disgrace: Seize My Property, Then Sue Me if I Complain

Yikes... this is ridiculous. As if the Kelo decision from the Supreme Court, and the countless similar eminent domain abuses weren't bad enough, this latest twist reported by Forbes magazine is outrageous: Seize someone's property, and if he cries foul, sue him.

More on Canada's Health Care System

The Feb. 9th issue of the Wall Street Journal had an excellent piece by Nadeem Esmail, titled 'Too Old' for Hip Surgery. This provides several examples of the perils of government-run/national health care systems -- and notably gives horror stories from Canada, one of the countries that politicians love to point to as a system that the US should emulate. Read this brief article and remember its lessons the next time you are told how wonderful such a system would be: where will you go when you are faced with similar wait lists and rationed care here in the US? If every country adopts such a system, there won't be anywhere for folks like those in this story to escape to for timely life-saving care!

Gary Becker on the Stimulus Plan

In the Feb. 10 issue of the Wall Street Journal, Nobel economist Gary Becker (along with Kevin Murphy) analyzed the stimulus plan working its way through Congress: There's No Stimulus Free Lunch. They consider the plan's effects according to four basic factors -- a good read.

BB&T's Allison on how a truly free market could have prevented this

People who are blaming "capitalism" and "free markets" for all of the problems in our banking and financial systems are willfully evading the extent to which our system is not truly free at all. I mean we have how many pages of regulations already? And we have government institutions like Fannie and Freddie, not to mention the Federal Reserve itself?

While the US remains more capitalist and free-market than many other countries, we have been steadily becoming less free since just about day one. Or perhaps "steadily" isn't quite the right word, since our economic history if punctuated by specific government actions that have decreased the level of freedom in our markets... but the general trend has been consistently downard in this regard. The similiarities with some of the events of Ayn Rand's novel Atlas Shrugged are made clear almost every day.

Here is a good writeup (split into six short pages) at TheStreet.com about the views of John Allison, BB&T Chairman and free-market enthusiast: BB&T's Allison: A Free Market Could Have Prevented This. Embedded in the article are several audio clips of an interview with Allison, so don't miss those too.

Here are some good bits from the article:

"This is potentially the worst economic correction that I experienced in my career," he says. "What's unique in this correction was the panic created unfortunately by the Treasury, the Fed and [former President Bush] in October."

Allison takes issue with the government's ability to produce -- "out of the blue" -- $700 billion for the bailout package; the "incredible arbitrariness" of saving some banks and letting others fail; and the lack of consistency within the plan so far, he says.

"Markets hate that kind of stuff," Allison says.

...

"[Allison] established and nurtured a corporate culture of the highest integrity," BB&T lead corporate director James Maynard, who is also the co-founder and chairman of the Golden Corral restaurant chain, said in the August release announcing Allison's retirement. "His leadership is unique and unprecedented in the financial industry. Our company has seen profitable growth for more than 20 years."

Unlike larger, in-state rivals like BofA and Wachovia, which was acquired by Wells Fargo (WFC Quote - Cramer on WFC - Stock Picks) at the end of last year, BB&T has remained profitable, mostly due to its conservative lending standards and the discipline that Allison and his team followed.

...

Allison says the roots of this downturn were laid out by years of easy credit and misguided policies from the Fed and Republican and Democratic administrations.

For one, the aggressively low interest-rate management by former Fed Alan Greenspan created the "illusion of low risk" in the economy that caused consumers and investors to "save less" and "make more risky investments," he says. From the early 1990s through 2007, "we didn't have a meaningful correction," he says.

...

Allison says the creation of the Federal Deposit Insurance Corp. in the 1930s provided a "lack of discipline" at financial institutions seeking to grow their deposit bases. Most importantly, he took issue with the Clinton administration's affordable housing policy objectives, which ultimately led to the solidification of government-sponsored enterprises Fannie Mae and Freddie Mac as major players in the mortgage market.

"Homeownership is a good thing in a broad context, but encouraging people to buy homes they can't afford is not a good thing," he says. "If you want to look at the proximate cause for this mess you got to focus on Fannie Mae and Freddie Mac. They would have never existed in the free market. They drove the mortgage market."

Video On the So-Called Stimulus Bill

Here is a good video on YouTube about the so-called "Stimulus" plan going through Congress right now. Only 7 minutes long, and very easy to understand, it is well worth a viewing.

The FDA and Health Care's Future

The Dec. 30th issue of the Wall Street Journal had two excellent opinion pieces about health care in the US:

• Obama Will Ration Your Health Care, by Sally Pipes
• The FDA Is Killing Crohn's Patients, by Gideon Sofer

The first gives a good summary of what we are likely to see coming soon in the US, given the selection of Tom Daschle as a key part of Obama's health care reform team. The second is yet another indictment of the horrible FDA, and yet more reason that the organization should be significantly reformed and preferably dismantled altogether.

On Property Taxes in New York

The top story in my local Rochester newspaper today described the results of a recent report from the Tax Foundation. I new that New York had really high property tax rates, the worst in the country. But in terms of property tax burden as a percentage of home values -- a useful statistic I think -- New York amazingly has 19 of the top 20 counties in the entire US. My home county, Monroe is fifth highest in the country, with a 2.8% rating. The highest is Orleans county in New York, which is at 3.0%. (The only county to crack the top 20 that is not from New York, in case you are curious, is Fort Bend, Texas.)

This is pretty depressing, since politicans talk about this issue all the time, but little is ever done about it. They just note the rising costs of this or that service, the hefty mandates imposed by the State government, and on and on. No one ever talks about the proper role of government, and about truly cutting back what the state does in a radical way -- even radical cuts spread out of a period of a decade to ease the transition. Until the people demand this, the politicians likely won't put forth such a radical plan. We'll just keep slowly leaking talented people out of the state, people who are fed up with our outrageous property taxes.

On Time People Spend Looking For Work

I don't recall ever thinking about this question before: How much time does the average unemployed person spend, in minutes and on average, each day? Well, an article in the Jan. 3 issue of the Economist magazine, A Safety Net in Need of Repair, provides the stats for a few countries.

See the graph that goes with the article. It seems that in the US the average unemployed person spends a little over 40 minutes a day "looking for work". That struck me as quite low. There are of course many important things one could be doing while umemployed in addition to looking for work aggressively: going back to school or getting more work training to better enable you to find a job in the future is one obvious example. Or if you have young children, then their needs -- in light of your inability to afford childcare now -- would also take up a lot of your time.

But still, it strikes me that 40 minutes a day is quite low. But what is quite interesting is that the other countries in the graph are all significantly lower on this metric! France is under 30 minutes a day, Spain just over 20, Germany about 10, and Britain and Sweden under 10! Yikes. The article I think rightly notes that this is largely because those countries have stronger UI programs and hence individuals have less incentive to aggressively look for work.

The article itself was arguing in favor of overhauling the unemployed insurance system in the US, presumably to give more benefits in light of the recession. I won't go into my views on this here, I'll just note that I hope that the congress and new administration take this intuitive, and apparently empirically-validated fact into consideration.

IRS Battles Over Pennies

Check out this story from a few days ago: 9-cent IRS Dilemma Leaves Lawyer Confused. This is definitely one of those stories that falls into my category of "Nearly a laugh, but really a cry".

Talk about "bigger fish to fry"... can't the IRS have software in place so that anything below, say, a few dollars gets ignored, or better yet, just considered settled? It obviously is a waste of government tax-payer dollars, not to mention this poor guy's time and money, to mess around with taxes for 4 cents or 9 cents or whatnot.

We need to get rid of the Electoral College

See this good Dec. 14th opinion piece from the WSJ, It's Time to Junk the Electoral College. Here Jonathan Soros gives a brief history of the Electoral College, and mentions many of downsides of it. For instance, our current system allows for a candidate who wins the national popular vote -- to actually lose the election (this happened to Al Gore in 2000). It also leads to politicians disproportionately focusing on the "battleground" states -- the ones that aren't guaranteed "red" or "blue" on the electoral map. A better approach would truly treat everyone's vote as equal.

The article then goes on to describe an approach to doing away with the Electoral College that does NOT involve a constitutional ammendment. I've read about this approach before, but didn't quite understand how it would realistically work. But this is a very good explanation, and I'm now in favor of this:

To understand how the proposal works, one needs to understand two basic principles. First, that state legislatures are basically unfettered in how they choose to appoint electors. And second, that groups of states can enter into binding agreements with one another in the form of so-called interstate compacts. There are many examples of such compacts, including the Port Authority of New York and New Jersey and the interstate agreement that guarantees a driver points on a Virginia driver license when he or she speeds in Maryland.

Under the proposed National Popular Vote compact, state legislatures would agree to choose electors who promise to support the winner of the nationwide popular vote. For example, if a Republican were to win the overall national popular vote, even if New Yorkers favored the Democrat, New York's Electoral College votes would go to the Republican. The compact will go into force when states representing 271 Electoral College votes have entered into it to guarantee that the winner of the popular vote will become president.

It is ironic that the most common objection to the National Popular Vote compact is the suggestion that it is antifederalist. In fact, interstate compacts lie at the very core of federalism: individual states combining their powers to solve a problem. In this case, they would be joining forces to allow their citizens to act as one nation in the selection of their president.

The National Popular Vote compact has already been enacted by four trailblazing states -- Maryland, New Jersey, Illinois and Hawaii -- and has been introduced in 41 others. It's time that the rest of them got on board.

A Step in the Right Direction for Organ Donation?

See the Dec. 17th WSJ opinion piece Wait-Listed to Death. This article discusses the work Arlen Specter (R, Pa.) is doing to re-write the provision of the 1984 National Organ Transplant Act that bans any incentives for people to donate bodily organs.

I'd much rather see us make more dramatic changes than what Specter is pushing for -- such as creating a market for organs to really boost supply and save many lives and improve the quality of life for so many more. But short of that, I think what Specter is pushing for is a good first step. There are many unintended consequences of the currently law, such as this:

The impact of the federal statute is as appalling as it is ironic. Kidney transplant recipient Sally Satel has noted that burial and cremation expenses can be provided when a body is donated to science -- as long as it isn't used to save the life of a current patient.

Even if you don't agree with me that people's families should be able to be paid in order to encourage organ donation upon death, or that people should be able to be paid in exchange for donating a kidney while alive, who could argue with changing the law to end the above ridiculous situation? In that case, the benefit only covers some of the costs of the death -- burial and cremation expenses -- it doesn't provide any additional benefit to the surviving family. So even a desperate poor person wouldn't think of suicide to aid his family, because this revised law wouldn't receive any real financial benefits from it -- they just wouldn't have the added cost of burial/cremation brought about by the suicide.

This is a no-brainer, and it could help increase the number of people who agree to be organ donors upon their death -- something the thousands of people dying and suffering on organ waiting lists desperately need!

Unintended Consequences, Again: Campaign Finance Reform

October brought another good report from John Stossel, this one on campaign finance reform and some unintended consequences it has brought.

George Will on The Big Three

George Will wrote a good column a few days ago on why Congress should let the big three American automakers go into bankruptcy: In Detroit, Failure's a Done Deal. (It is also available at RealClearPolitics here.)

The Mortgage-Mess Fable

The Sept. 22 Wall Street Journal had a good opinion piece titled "A Mortgage Fable" that begins with a bit of humor, but then gives a nice overview of the key people and institutions at fault -- as they describe it, "Let us take the roll of political cause and financial effect". Included are: The Federal Reserve, Fannie Mae and Freddie Mac, A credit-rating oligopoly, Banking regulators, The Bear Stearns rescue, and The Community Reinvestment Act.

Bizarre Pork Along For the Ride

The "new and improved" (LOL) bailout (errr.... rescue) plan that was finally agreed to by Congress and the President naturally includes plenty of "pork" spending. A lot of this comes by means of bizarre, very specific tax exemptions. This USA article describes this, but I got a groan-laugh from the sidebar content that lists "some tax breaks in the current bill":

• Bicycle commuters. Provides employees who commute by bicycle limited benefits to offset commuting costs. Estimated cost: $10 million over 10 years.
• Children's wooden practice arrows. Exempts wooden practice arrows from excise tax, currently 39 cents. Estimated cost: $2 million over 10 years.
• Film and television productions. Allows more film and television show production companies to use the domestic production deduction. Estimated cost: $397 million over 10 years.
• Commercial fishermen. Allows commercial fishermen and others affected by the Exxon Valdez oil spill to average any settlement or judgment-related income over three years. Estimated cost: $49 million over 10 years.
• Motorsports complexes. Extends seven-year cost-recovery period to the end of 2009 for land improvement and support facilities placed in service after Dec. 31, 2007. Estimated cost: $100 million over 10 years.

Sigh... Think about the waste in our system of government, such as the time and money spent by lobbiests on these issues, some perhaps over many years. And then think about how none of these things have anything to do with the bailout plan being voted on -- other than the specific congresspeople who wanted these earmark items, do the others even know they were tacked on for the ride? Probably not. How pathetic. Something like the Read the Bills Act might help with this craziness. But of course, to really fix things much more dramatic changes in our government would be needed: greatly limiting the federal government, indeed all government, to its proper functions -- protecting our individual rights. That would do away with all "pork" spending, lobbying for money, etc. Obviously... I'm not holding my breath for such a principled change in the US anytime soon.

Political Videos from The Onion

There are some funny US Politics videos these days at The Onion, including:

• Latest Poll Reveals 430 New Demographics That Will Decide Election
• Bush Tours America to Survey Damage Caused by His Disastrous Presidency
• 'No Values Voters' Looking to Support Most Evil Candidate
• Diebold Accidentally Leaks Results of 2008 Election Early
• McCain Vows to Replace Secret Service with His own Bare Fists
• Portrayal of Obama as Elitist Hailed as Step Forward for African Americans
• Poll: Bullshit is Most Important Issue for 2008 Voters
• How To Pretend You Give a Shit About the Election
• As Obese Population Rises, More Candidates Courting the Fat Vote

On Fannie Mae and Freddie Mac

A month ago Paul Gigot wrote a great opinion piece for the Wall Street Journal: "The Fannie Mae Gang". If your only somewhat familiar with the history of Fannie Mae and Freddie Mac, then I encourage you to read this article. I really liked the ending of the article, and I've bolded a key paragraph:

Fan and Fred also couldn't prosper for as long as they have without the support of the political left, both in Congress and the intellectual class. This includes Mr. Frank and Sen. Chuck Schumer (D., N.Y.) on Capitol Hill, as well as Mr. Krugman and the Washington Post's Steven Pearlstein in the press. Their claim is that the companies are essential for homeownership.

Yet as studies have shown, about half of the implicit taxpayer subsidy for Fan and Fred is pocketed by shareholders and management. According to the Federal Reserve, the half that goes to homeowners adds up to a mere seven basis points on mortgages. In return for this, Fannie was able to pay no fewer than 21 of its executives more than $1 million in 2002, and in 2003 Mr. Raines pocketed more than $20 million. Fannie's left-wing defenders are underwriters of crony capitalism, not affordable housing.

So here we are this week, with the House and Senate preparing to commit taxpayer money to save Fannie and Freddie. The implicit taxpayer guarantee that Messrs. Gray and Raines and so many others said didn't exist has become explicit. Taxpayers may end up having to inject capital into the companies, in addition to guaranteeing their debt.

The abiding lesson here is what happens when you combine private profit with government power. You create political monsters that are protected both by journalists on the left and pseudo-capitalists on Wall Street, by liberal Democrats and country-club Republicans. Even now, after all of their dishonesty and failure, Fannie and Freddie could emerge from this taxpayer rescue more powerful than ever. Campaigning to spare taxpayers from that result would represent genuine "change," not that either presidential candidate seems interested.

Ugh. Clearly these "institutions" need to end up being privatized somehow (if you need to first nationalize them, I'd be open to at least considering that, as long as the end goal was privatizing). Indeed, Fannie and Freddie should never have been created in the first place. The government should not be in the housing loan business, risky ones or otherwise. Why? The proper role of government is the protection of individual rights. There is no individual right to own a home, pure and simple. So the government shouldn't be involved, not directly and not through half-government proxies like Freddie and Fannie.

Krauthammer on Pelosi on Drilling

Charles Krauthammer's Washington Post column this past week was pretty good: "Pelosi: Save the Planet, Let Someone Else Drill". He does a great job stating the unintended consequences of Pelosi's resistance to allowing for off-shore drilling and drilling in a very, very small amount of the ANWR. Here is snippet, but I encourage you to read his entire column:

Does Pelosi imagine that with so much of America declared off-limits, the planet is less injured as drilling shifts to Kazakhstan and Venezuela and Equatorial Guinea? That Russia will be more environmentally scrupulous than we in drilling in its Arctic?

The net environmental effect of Pelosi's no-drilling willfulness is negative. Outsourcing U.S. oil production does nothing to lessen worldwide environmental despoliation. It simply exports it to more corrupt, less efficient, more unstable parts of the world -- thereby increasing net planetary damage.

Of Onions and Oil

The July 8 WSJ had an interesting opinion piece titled "The Onion Ringer". It notes the effects from a ban on futures trading in onions, and argues that the same negative effects could occur if congress continues to demonize, and eventually bans, oil speculators.

On the Electoral College

I'm against retaining the Electoral College process in the US. On this issue I am open to debate though, so I was interested to read arguments in favor of the current system in the WSJ opinion piece titled "Don't Mess With the Electoral College". But I was very disappointed by the weak points made by its author, David Lewis Schaefer.

First, he focuses on the "National Popular Vote" scheme, which wouldn't get rid of the Electoral College system as such (as that would require a Constitutional amendment), but would rather have states designate their electoral votes to whoever won the national popular vote. For me then, he is arguing against a straw man.

But even his specific arguments seem weak to me. He seems to think it a good thing that the current system "favors the two party approach". Why not give third parties a chance? He writes:

Today voters have little incentive to vote for candidates nominated by minor parties such as the Libertarians, the Greens or Ross Perot's 1992 Reform Party. Since winning even 30% of the vote nationwide is likely to yield very few (if any) electoral votes, most voters wind up choosing one of the two major-party candidates.

Those who think that fact a vice should consider the alternative. Under NPV, states commit their electoral votes to the winner of the national popular vote, regardless of how small a percentage of the overall vote that candidate wins. Thus a candidate whom a large majority of Americans finds highly unacceptable might become the next president. That's because the NPV would encourage more minor-party or "insurgent" candidates who'd been denied the nomination of one of the major parties.

At most, this is an argument against the NPV approach. Ditching the Electoral College could be done in various ways, including a system that demanded a first round followed by a run-off between the top two or three candidates. Also, it seems unlikely that many third-parties would find greast success overnight, as the Electoral College is only one part of the process that is rigged against them. Odds are, for the foreseeable future, the Dems and Reps would continue to dominate the scene.

He also asserts that "It also ensures that the winner will have geographically broad (rather than merely sectional) support, and will be at least acceptable to the vast majority of the electorate." So what? Why does it matter that the winner have "geographically broad support"? If more people prefer another candidate, then that other candidate should be the winner. Period.

Another of his arguments:

Another problem: If vote totals are close, the losing candidate has a strong incentive to demand recounts or challenge voting procedures in every state, regardless of how badly he lost. After all, "every vote counts." Imagine the Florida debacle of 2000 spread across dozens of states, every four years.

This is exaggeration. "Every four years"? You prefaced this with "If vote totals are close...", and that doesn't happen every time. But besides that, if it took vote recounts, even across the entire nation, to get it right, then so be it. The alternative is the person who gets less votes winning the race. How is that better?

Then he adds this nonsensical closing:

Is there really any need to abolish the existing system, just because candidates who "lose" the popular vote by a small margin sometimes come out on top in the electoral vote? The true purpose of an electoral system is not to ensure that the presidential candidate preferred by 51% of the electorate is chosen. Rather, it is to choose an effective leader whom even most supporters of the losing major-party candidate will regard as tolerable -- so that the government is perceived as representing the people as a whole, not just victorious partisans. That's why leading-party candidates typically "run toward the middle" during the general election campaign. In a two-party race, you can't win an election without demonstrating your acceptability to a large swath of the public.

Huh? "...just because candidates lose the popular vote by small margin"? Why are in favor of arbitrarily elevating the loser to the status of winner? His answer is ridiculous: "Rather, it is to choose an effective leader whom even most supporters of the losing major-party candidate will regard as tolerable -- so that the government is perceived as representing the people as a whole, not just victorious partisans." It would seem that, in the abstract, if the person who gets 49% of the vote is "tolerable" by your standards, then so would the person who got 51% of the vote. So by what reason do you still go for the one with 49%? And lastly, candidates "run to the middle", not because of the Electoral College, but because that is where the biggest votes are. The same would be true if we had a straight popularity majority vote system, or one with stages/runoff rounds.

I'm still not convinced that retaining the Electoral College is the right thing to do. I would argue we should not have it, and that we should have either a majority vote system or a plurality vote system with one or two runoff rounds if a certain threshold percentage of votes is not obtained. The benefits of this would be at least the following:

• Third parties might finally have a chance to be heard (at least this one hurdle would be removed for them.)
• It would mean we never have someone who loses the popular vote being elected president.
• It would mean every vote would count equally. Right now, I know my vote in NY doesn't matter because the Democrat will easily win the state and hence get all of NY's (rather sizeable) electoral votes.
• It would reduce or eliminate all of the silliness of the news coverage and debates on a state by state basis. Stop wasting time and money -- just count the votes.

The only semi-plausible argument I've heard against this approach is one of the original arguments in favor of the Electoral College -- that it helps preserve the importance of smaller states. That is, it encourages candidates to visit and campaign in more states, rather than just focus on the biggest states and cities. But the EC system actually has perverse effects in this regard, as it encourages candidates to relatively ignore very large states that are undoubtedly going to go their way (like NY for Democrats). How is that fair? And it also leads to candidates spending more time on issues of interest to just particular states that are "in play". Presidential candidates aren't running to be "President of the states that are up for grabs", they are running to be President of the entire country.

And even if this was a valid point in the early days of the country, when almost all campaign-relations were local, it has almost no weight today. Most people get most of their input on who to vote for from newspapers, magazines, TV, the Internet, etc. -- not from the silly hand-shaking, baby-kissing events if and when the candidate happens by our village square. Save all that money wasted criss-crossing the nation, and put it to better use on other aspects of campaigning. The inefficiencies due to unintended consequences of the EC system are astounding.

Oh, and while I'm on this general topic, can we also please get rid of the silly system of having some states hold political primaries significantly before others? How is that fair? What gives people in Iowa and New Hampshire the right to effectively rule out some party candidates before the rest of us have had our say? All states should hold political primaries on the same day, or at least the same week, so that this negative effect is eliminated. Again, if you are an egalitarian when it comes to political rights, then this is the only fair approach to take.

On Offshore Drilling

The July 12/13 WSJ had an interesting opinion piece titled "Environmentalists Say Yes to Offshore Drilling". The part of the story supporting the provocative title was of some interest to me, but even better were the numbers reported that indicate the different sources of oil spillage into the oceans. Guess what? Offshore drilling is not a major source at all, and still wouldn't be even if US government restrictions were loosened. Here are the numbers from a joint study by NASA and the Smithsonian Institute (amounts are per year):

• 363 million gallons -- runoff from dry land (cities, roads, industrial sites, etc.)
• 137 million gallons -- routine ship maintenance
• 62 million gallons -- natural seepage from underwater oil deposits
• 40 million gallons -- tanker spills (approximate estimate -- this figure wasn't given directly in the article, but I think I did the math right based on what was said)
• 15 million gallons -- offshore drilling

Here are the three paragraphs where the above numbers come from:

A joint study by NASA and the Smithsonian Institution, examining several decades' worth of data, found that more oil seeps into the ocean naturally than from accidents involving tankers and offshore drilling. Natural seepage from underwater oil deposits leaks an average of 62 million gallons a year; offshore drilling, on the other hand, accounted for only 15 million gallons, the smallest source of oil leaking into the oceans.

The vast majority of the oil that finds its way into the sea comes from dry land, NASA found. Runoff from cities, roads, industrial sites and garages deposits 363 million gallons into the sea, making runoff by far the single largest source of oil pollution in the oceans. "Every year oily road runoff from a city of 5 million could contain as much oil as one large tanker spill," notes the Smithsonian exhibit, "Ocean Planet."

The second-largest source of ocean oil pollution was routine ship maintenance, accountable for 137 million gallons a year, NASA found -- more than 2.5 times the amount that comes from tanker spills and offshore drilling combined. But no one is proposing that we ban cargo and cruise ships.

Spitzer Bombshell Apparently a Minor Story

Today the huge story about NY Governor Elliot Spitzer and his involvement with a prostitution ring came to light. I was curious how some of the media would cover this. For some reason I was particularly curious to see what Keith Olbermann would do with it on his often-raving-loud one-hour show from 8-9 EST. Well... it was quite interesting... I missed the first two minutes of his show, so likely he did mention it briefly then. However, he then went on and on about relatively minor Hillary vs. Obama drama items... for about 30 minutes! He didn't really cover the Spitzer bomb until after the half-way point in the show. I think it was big-story #3 on his program, and he only spent about 5-7 minutes on it. Doesn't this strike anyone else as strange?

I'll also note that the Atlas Society was quick to send out a brief blurb on this news, noting correctly:

It is ironic that New York Democrat Governor Eliot Spitzer has had his undeserved reputation for high moral standards tarnished by his sexual escapades which, while perhaps sleazy, did not harm any of us. In fact he deserved our moral scorn for his assault on productive individuals and flaunting of the rule of law when he was New York attorney general, done arrogantly in the name of "morality."

I had the exact same thoughts while watching the coverage tonight.

Scary New York Numbers

I regularly read or hear statistics about New York State that indicate it is below average or near the bottom among the 50 states in a wide range of categories. Most of the time, these stats are talking about high taxes or other economic figures.

Columnist Jay Gallagher has done us all a great favor by gathering together many such statistics into one column, New York's Numbers are Numbing. Not all of these numbers are bad for New York -- a few are actually pretty good (low crime), and many are middle-of-the-pack (so not that bad at least relative to other states). But ouch... so many of these numbers place New York at or near the bottom.

An Update on the Government Spending Numbers

Here is a nice column from Jacob Sullum, Entitlement Mentality, that covers all the earmarks in the recent spending bill, and also reminds us of the ridiculous economic crisis that the big three entitlement programs represent.

Government Should Not Promote Home Ownership

Government should not have policies that "promote home ownership". The very idea implies interference in the free market. Yaron Brook wrote a very good piece, Predatory Legislating, for Forbes in December, attacking the ridiculous "Mortgage Reform and Anti-Predatory Lending Act of 2007", legislation passed in the House in response to the "subprime mortgage crisis". The entire commentary is worth reading, but here are the two paragraphs on the fundamental point that is so often missed in the press when folks are talking about how the subprime mess arose:

The government does not need to crack down on lenders. It does need to take responsibility for its role in promoting irresponsible lending and borrowing practices through its myriad interventionist programs to "promote homeownership." The very concept of the government having such a goal means that it facilitates borrowing and lending that would not occur on the free market--i.e., a market in which people are held fully responsible for their decisions.

One example of this is the Community Reinvestment Act, which literally forces banks to lend to people with high credit risk. Another is the Federal Reserve's policy of creating artificially low interest rates, which encouraged financial institutions to lend out more money for mortgages than they otherwise would have--and which helped artificially bid up housing prices and fed the fervor that buying a home at any price is a can't-miss investment that all Americans should make. The government's promotion of home-buying was a recipe for irresponsibility--and that's exactly what it produced.

On Ron Paul

The rise of Ron Paul during this 2008 presidential primary season has been a fascinating phenomenon to watch. As someone who believes in small government, there obviously are moments when I find myself in agreement with his positions and views. He is more of a "Libertarian" than a typical "Republican" -- indeed, a couple of decades ago he ran for president on the Libertarian Party ticket.

That said, I don't support Ron Paul for president. I don't support him for many of the same reasons I don't call myself a "libertarian": that word is both too vague and generally represents a position that starts at the political level --rather than more fundamental philosophical levels. And then not surprisingly, I disagree with the views of "libertarians" on many specific and important issues of the day (while agreeing on a superficial level on some issues).

My friend Shawn Klein has summarized why he doesn't support Ron Paul, on an issue-by-issue basis, drawing on Paul's own campaign website. See also his followup to clarifiy non-interventionism points, I generally agree with Shawn's assessments. Apparently, since he wrote that post, the Paul site has been changed and now lists 16 issues, so I hope that Shawn can offer his views on the new ones sometime. If I find time and inclination, I might take a closer look at the current "isseus" section at Paul's site and comment as well.

For now, as an aside, I'll note that I find it particularly odd that the 16 issues include what I would generally consider "big issues" -- except one of them is "No taxes on tips", which is about exactly what it sounds like, the position that "tips" such as waitressing tips should not be taxed. I agree with Paul on that, but is that really worth mentioning on the same level as "Education" and "Health Care"? Obviously not. I wonder if the webmaster for the Paul campaign works as a waiter/waitress in his/her spare time, and got this issue inserted as part of their pay for work on the site? LOL

Robert Bidinotto has also done some good blogging on the Paul candidacy, focused mostly on the foreign policy area. Check out his post Ron Paul's "non-interventionism" fraud. And then the magazine Robert is the editor of, The New Individualist, has a cover story about Ron Paul (here is Robert's blog post about this issue of the magazine, with provacative cover scan).

The Need for an Organ Market

I meant to blog about this weeks back, but it slipped through the cracks. A great letter to the editor was published in the Chicago Tribune in November about the need for a market for organ donors. It doesn't get much more succinct and powerful than this:

Thousands have died through the years waiting for transplants because the National Organ Transplant Act forbids the sale of human organs. To significantly decrease the shortage of organs, this murderous law must be repealed and the trade in organs decriminalized. If the law recognizes our right to give away an organ, it should also recognize our right to sell an organ. And if the law recognizes our right to pay for a life-saving medical treatment, it should also recognize our right to pay for a life-saving organ for transplant.

Those able to pay for organs would benefit at no one's expense but their own. Those unable to pay would still rely on charity, as they have done to this day. Moreover, those able to buy organs would drop out of the waiting list, increasing the chances of those remaining to obtain the organs they need.

If the legitimate rights of potential buyers and sellers of organs were protected, many of the 95,000 people waiting for organs would be spared much suffering and escape an early death. How many? Let's find out.

Daniel Boone and the Nanny State

The Orange County Register recently published an interesting satirical piece: Daniel Boone vs. the Nanny State. While I certainly want to live in Daniel Boone's time, this essay makes many great points.

Romney On the United Nations

Since he's a conservative Republican, there are many things that I disagree with Mitt Romney about. But there are some areas of agreement too, and his recent statements about the United Nations seem to be on the right track. See Romney Calls UN an 'Extraordinary Failure'.

I agree that the UN has been a huge failure over the years, on many dimensions. Not that it hasn't done any good for anyone at any time -- surely it has here and there. But overall, I think it has done far more harm than good. And I don't just mean the obvious, direct harms -- such as UN workers raping women in the Congo, or massive corruption schemes like Oil for Food, or the many other items that have grabbed headlines.

I'm also talking about the apparently less obvious harms that arise from actually having a body that is composed half of democratic, relatively rights-respecting nations, and the other half literally populated by criminals. And make no mistake, that is what nations run by dictators, tyrants, monarchs, communists/socialists, and so on are -- they are nations run by criminals. Such statist regimes deny individual rights by their very nature -- some worse than others, but all to such a degree that they are different in kind than the relatively-free nations of the world like the USA, Britain, Canada, and so on.

So I'm glad to hear a Presidential candidate in the US call for "a coalition of 'free nations' as an alternative to the UN." Good for Mitt. Much of the news on this story centered around the UN's Human Rights Council, which the US has boycotted from the perspective of diplomacy and membership, because it insanely allows countries with horrible human rights records to be members.

But the HRC is not the core problem -- the UN as a whole is. I mean, what sense does it make to invite practically all nations of the world to gather to discuss issues, when so many of these nations are ruled by criminals? Do our police sit down a big table with known criminals to discuss issues in our cities? Uh, no. Too simplistic of an analogy? I don't think so.

One other thing to note about the MSNBC article linked above in particular, as it includes the following: "The comments highlighted the deep mistrust of the UN among many US conservatives, who view the organisation as an obstacle to US interests and a constraint on US power." While there might be some "conservatives" who bemoan obstacles and constraints to US interests and power in the world, this is a misunderstanding -- or blatant misrepresentation -- of the complaint that most conservatives, libertarians, Objectivists, and others have about the UN.

The primary complaint about the UN is not because it lessens US interests, but because it is inherently corrupt and does more harm than good -- objectively speaking. The UN is rotten at its core, because it allows nations ruled by criminals -- tyrants, dictators, monarchs, and so on -- to have seats at the table, chairs on the Human Rights Council, and positions from which to negotiate with the relatively free, rights-respecting nations of the world. That is the issue, and that is why the UN should be abandoned, and if any organization is created to replace it (debatable), it should be formed with far higher standards of admission.

FDA: Definitely not "First, Do No Harm"

A vital phrase for those in the medical profession, "First, do no harm", goes back to the ancient Greeks (though, contrary to popular belief, it is not found in the Hippocratic Oath).

The following paragraph from the Wikipedia entry for this phrase (Primum non nocere) does a nice job summarizing its importance:

It is one of the principal precepts all medical students are taught in medical school. It reminds a physician that he or she must consider the possible harm that any intervention might do. It is most often mentioned when debating use of an intervention with an obvious chance of harm but a less certain chance of benefit.

I mention this important precept in relation to the WashingtonPost story, Teen Suicides Up Sharply For First Time In Years. (Thanks to John Enright for the link.) And what is the speculated reason in this news story as to the likely cause (or the biggest reason) for this increase in teen suicides? The actions of the FDA.

How so? Well, remember several years ago when the FDA got wind of studies that indicated that some anti-depressant medications (e.g., SSRIs) could have increased rates of suicides in the young, especially during the first few weeks of taking the medications as the body and mind adjusted to them? Their reaction to this was to further regulate such medications, and do so in scare-tactic fashion, by forcing the companies producing them to put big black box suicide warnings on them, targeted at teenagers specifically.

So what happened? Well, surprise, surprise: use of such medications declined dramatically amongst teens. But it is exactly these medications that are credited with helping to reduce the rate of suicide for many years previous. I mean, the biggest cause of suicide is no doubt severe depression, right? And what do people take for depression? Anti-depressant medications. So scaring people away from the medication that will help them... real bright, FDA, real bright.

Did the FDA factor this inevitable outcome into their decision process? I suspect not, or at least not well enough. The FDA has a pattern of reflexively regulating drugs based on studies (particularly big noise-making ones) that show or suggest (more or less well) negative side-effects from taking those drugs. After all, history in the US has thus far shown that no one will get fired at the FDA, nor will budgets be slashed, when thousands or millions of people die because the latest life-saving drugs are held up by FDA rules, regulations, and bureaucracy. But failing to regulate something when there is a shred of evidence that some people might have a negative side-effect -- they can't let that happen!

And this is not something the FDA can simply tweak and get better at doing. The FDA, or any such regulating body, simply can't do a very good job of weighing the personal benefits of new drugs against the possible personal negative side-effects for those same people or others. The benefits are too personal: each individual would have a different value hierarchy, meaning for one person it might worth the increased risk of heart attack to be rid of some other ailment they have, but for someone else it would not. A drug that could save millions from one killer ailment, is held up because it might increase the risk of some other ailment for those same people or others. Rather than leave it alone, regulation keeps the drug from the people who need it and want it. By what moral right does the FDA do this, by what moral right do they get to make these value decisions?

In the current case of the teen-suicide warnings, did the FDA consider the externalities of this decision? Did they weigh the harm that such a policy would do against the supposed good it could do? At first glance, one might see nothing wrong with informing people about studies on a drug that indicate a greater statistical chance of suicide amongst a population. But in addition to the above points, there is a crucial difference that complicates this case that doesn't complicate other drug studies. Unlike medications that cure one ailment but might lead to increased heart-attack risk, here we are talking about suicide -- so free will comes into play. Even if full free-will is somewhat inhibited when severe depression develops, this greatly complicates any studies in this area (in a way that doesn't arise for studies on the pancreas), making studies and aggregate statistical analysis far more difficult.

All of that said, and while I'm no expert on this, as I have said before (see my posting on this) I am prima facie doubtful of the studies indicating increased suicide as an effect of using SSRIs or other anti-depressants. Often people start taking these medications after their first visit to a doctor for depression, and because they take a while to take effect, the depression can continue to get worse before the medications help the people help themselves and begin to get better. But this is not the fault of the medication! The person was likely going to keep trending downward for a while regardless, and if they had waited until they pretty bad off before seeing the doctor, well, they might be suicidal or nearly so already.

Further, a person might become increasingly depressed when they first start trying an SSRI and don't see immediate results -- especially if their doctor didn't impress on them how the drugs work (the time needed, etc.). They might conclude "This isn't even helping? So nothing will, and I can't bear it!". But again, this is not the fault of the medication!

Do the studies the FDA relied on to require the warning boxes for teens take into account all of these kinds of points? I wonder. I don't know either way, but I wonder.

What is obvious about the track record of SSRIs and other anti-depressants (from what I gather from this article and elsewhere) is that they have been a major factor in decreasing suicide rates. Until, that is, the FDA got involved, scared teens (and their doctors) away from the medications, and the rates apparently went sharply up again. Take away a major weapon in one's battle against depression, and surprise, surprise, more people will become increasingly depressed and commit suicide. That should have been obvious to FDA regulators, but apparently it wasn't.

Btw, I've written a few posts on the FDA here at Philosopher Stone. Check them out!

• August 11, 2007: The FDA Ranges from Annoying to Deadly
• August 11, 2007: A Possible Future: Prescription Drug Disaster
• July 5, 2007: On the Costs and Benefits of Health Care Regulation
• June 3, 2007: Walter Williams on the FDA
• May 3, 2007: Depressed About Anti-Depressant Warnings
• September 26, 2006: FDA Should Retire at Age 100
  

Early Punditry on the Iraq War

This is a nice collection of mostly Republicans early during the Iraq war mess. I think the worst one here is from Fred Barnes, because for our military it was obvious that winning the initial "war" was going to be the easy part, not the hard part. Jeez... (Thanks to Radley Balko for the link.)

More on the Terrorism/Drug War Connection

Jacob Sullum wrote a nice column on the continuing connection between the Taliban and America's drug war policies, America's Taliban-Support Program. Nothing new for me here, except some updated numbers. But this is an important item to read if you are a supporter of the "drug war" policies in the USA.

Revolutionary Guard Not the Real Problem

Here is an interesting posting, The Bush Administration's Latest Deadly Evasion, on the topic of labelling the Iranian Republican Guard as a terrorist organization. The author is critical of this, though not for reasons that others are. The analogy here to the Mafia hitmen and Navy of the Nazis, is one I hadn't heard elsewhere. And then here is a question from a reader and response from the author.

Hillsdale Says No Thanks to State Aid

A few weeks ago I wrote about Hillsdale College, the school that refuses federal aid on principle. Now, as the CHE reports (see also the news item from Hillsdale itself), they are going to cease taking state aid as well. It doesn't seem like their students were using a lot of it anyway, nor was the state of Michigan interfering with the college. But the important point here is one of principle, so again I congratulate Hillsdale for taking this stand.

A Possible Future: Prescription Drug Disaster

I recently blogged about how generic drug prices are soaring in Canada.

The flip-side of this is that brand-name drugs are of course cheaper in other countries like Canada. Here is a great ARI item that explains why that is. The crucial question is "Why?" and the answer is price controls in such countries. But the only reason this doesn't cripple the R&D efforts of drug companies -- and hence their ability to create new, life-improving and life-saving drugs -- is that people in countries like Canada free-ride on the prices paid by Americans. Creating drugs is extremely expensive: not only is the R&D rightly expensive and time-consuming, but it is made much worse because of the onerous regulation of the FDA and other government bodies. Other major costs include advertising/marketing to get the word out about new or improved drugs to doctors and patients.

This ARI item gives voice to a pro-consumer argument that you will hear almost nowhere else, as it ends as follows:

It is only because the American market is free from price controls that drug companies are able to recoup their enormous R&D costs, and thus find it profitable to sell additional units of the drugs at a lower cost in other, price-controlled countries. Should America impose price controls either directly or by proxy, the house of cards will collapse. We should protect the rights of pharmaceutical companies--and the welfare of consumers--and demand an end to price controls, direct and indirect.

The FDA Ranges from Annoying to Deadly

My local Rochester paper yesterday ran a brief AP story titled "FDA Checks 2 Popular Heartburn Drugs". Here is a link to a slightly longer version of the same article at the LA Times, and here is the item on this from the FDA website. The story is that some new data might indicate a connection between using two AstraZeneca heartburn drugs (Nexium and Prilosec) might increase serious heart-related problems. The new data doesn't seem to add up to much, as the FDA's position is "At this time, FDA's preliminary conclusion is that collectively these data do not suggest an increased risk of heart problems," and also "Therefore, FDA does not believe that healthcare providers or patients should change either their prescribing practices or their use of these products at this time."

So such downplaying makes me wonder a bit why this is a story worthy of being in the newspaper. But then you have to wait till the end of the article for this:

A higher number of patients taking either one of the drugs suffered heart attacks, heart failure or sudden heart-related death, the FDA said. But the studies involved only a few hundred patients, a relatively small number, and larger research studies showed no indication of heart problems.

So why is this news? Sounds like at best it is some counter-evidence to larger studies that indicate no such cause-and-effect problems for heart-attack, etc. for these drugs.

While that was the last paragraph in the article in my Rochester paper, the LA times version adds this final paragraph:

In the study involving Prilosec, 17 patients taking the medication had serious heart problems, compared with eight in the group that had surgery, AstraZeneca said. However, the Prilosec patients appeared to have been in poorer health to begin with. Six of the Prilosec patients had had previous heart attacks, compared with none in the group that had surgery.

Well, that makes it even worse! So the studies in question are not only smaller than the others, but they seem to have rather important problems with how they were conducted, factors that weren't ruled out, and so on.

All of that is bad enough -- a seeming waste of our taxpayer money chasing down unlikely side-effects based on small, poorly conducted studies. But that is merely annoying compared with the truly deadly effects of the FDA's and other federal regulations on drugs and health care. First, see my recent post about two articles from the Economist that explains the often hidden costs of such regulation. Then see the recent ARI press release, The Deadly FDA, which really puts a sting into the FDA. It begins:

The Court of Appeals for the District of Columbia Circuit recently ruled that terminally ill patients do not have a right to take medicines that have not been approved by the FDA.

"Barring individuals from choosing what medicines to take is immoral and destructive," said Dr. Yaron Brook, executive director of the Ayn Rand Institute.

"The decision about what drugs to put in one's body rightfully belongs to each individual, not to FDA bureaucrats. To deny individuals this right is to impose a death sentence on those who, in the face of certain death, would rationally choose to accept the risks of an experimental treatment, but are barred from doing so until the urgently needed drug completes the FDA's onerous, years-long approval process. Indeed, this case was initiated by a group founded by the father of a girl who died after she was denied access to an experimental anti-cancer drug the FDA later approved.

"Individuals, in consultation with their doctors, should be free to assess the evidence of a drug's effectiveness and safety, taking into account their own personal context (such as their unique risk factors, or the fact that they are certain to die without the treatment). Some people may take ineffective or harmful drugs, but FDA approval does not eliminate such risks. The individual always assumes some level of risk when deciding on a course of treatment, and it is capricious--and too often deadly--for the FDA to usurp the individual's right to decide which risks it is in his interest to accept.

The rest of the press release is just as damning of the FDA as the above, and also gives brief responses to objections to this kind of view of drug regulation.

Sowell on Neglected Infrastructure

Thomas Sowell has written a good column, A Bridge Too Far Gone, on some of the neglected infrastructure in the US. This is of course written in the wake of the bridge collapse in Minnesota, and the inevitable questions about similar bridges and other infrastructure issues around the country.

Some people claim that the problem is how much money it would take to properly maintain bridges, highways, dams and other infrastructure. But money is found for other things, including things far less urgent and some things that are even counterproductive.

The real problem is that the political incentives are to spend the taxpayers' money on things that will enhance politicians' chances of getting re-elected.

There may be enough money available to maintain bridges and other infrastructure but that same money can have a bigger political pay-off if spent building something new instead of maintaining and repairing existing structures.

When money is spent building a new community center, a golf course, or anything that will be newsworthy, there will be ribbon-cutting ceremonies and the politicians who cut the ribbons can expect to see their pictures in the newspapers and on TV.

All that keeps their name before the public in a positive role and therefore enhances their prospects of being re-elected.

But there are no ribbon-cutting ceremonies when bridges are being repaired or pot-holes are being filled in. These latter activities may be more valuable than a community center or a golf course, but they are not nearly a photogenic.

He then goes on to note that this incentive problem has existed for centuries, and that the situation will not improve until incentives are changed. He then makes a brief case for doing exactly that -- by privatizing bridges and other aspects of our infrastructure.

A company that has to get the money to build and maintain bridges or other infrastructure through the voluntary actions of people in the financial markets, instead of being able to extract money from the taxpayers, is going to find financiers a lot more finicky about what is being done with their money.

People who are putting their own money on the line are going to want to have their own experts taking a look under the bridges they finance, to see where there are rust, cracks or crumbling supports.

When people know that the lawsuits that are sure to follow after a bridge collapses are going to drain millions of dollars of their own money — not the taxpayers' money — that keeps the mind focussed.

Government as a Cause of Subprime Follies

Thomas Sowell has written a column, Sub-Prime Politicians, that describes the mutliple ways that bad government policies are causes of the subprime mortgage mess. Government restrictions on building in certain times and places have been shown to be a major factor, as has the more obvious and direct government interference of pressuring lenders to give loans to people with risky credit to encourage more home ownership. He concludes his column as follows:

Yet with all the finger-pointing in the media and in government, seldom is a finger pointed at the politicians at local, state and national levels who have played a key role in setting up the conditions that led to financial disasters for individual home buyers and for those who lent to them.

While financial markets are painfully adjusting and both lenders and borrowers are becoming less likely to take on so much risky "creative" financing in the future, politicians show no sign of changing.

Why should they, when they have largely escaped blame for the disasters that their policies fostered?

Repugnance Shouldn't Be a Standard

Over the past several years I've read more and more from bioethicists and others who argue against some regulation, policy, or law based primarily on the grounds of "repugnance". I've read this on the issues of stem cell research, cloning, euthanasia, and others.

This is absurd. One's subjective emotional responses -- whether discomfort, repugnance, apprehension, joy, elation -- are not a proper grounding for moral evaluation of an action, or a prospective regulation, policy, or law.

And yet this charge of "repugnance" surfaces time and again, perhaps most commonly in connection with the dire situation with the lack of kidneys available for transplant. There are no where near enough donors relative to the number of those who need a kidney -- people are suffering for years for lack of a kidney, and many die waiting for one.

And yet this problem could be solved in a relatively short time if a market for kidneys were allowed to develop and flourish. In such a market, individuals could be given cash payments for one of their healthy kidneys, or their beneficiaries could be given cash payment in exchange for kidney donation after death. The former is what would really fix the shortage, but even the latter (which seems like a no-brainer) would help. But neither of these are allowed today in the US. Although regulation of a market, generally speaking, interferes with that market and creates a suboptimal result, even a regulated market is better than no legal market at all. So in this case, as with many other non-violent acts that are currently prohibited, I definitely support a move from prohibition to a regulated market for kidneys.

The BBC recently did a special on this subject. This summary, after mentioning the "repugnance" or "disgust" viewpoint (I won't even call it an argument), quotes a Bishop whose position is that cash payment for a kidney negates the act's moral worth. His position apparently is that simply donating a kidney to a stranger or loved one is a good thing, but not if you are paid for doing so. This is, in part, the common ethical bias against money, commercial exchange, and best put -- the trading of a value for a value. This is a basic -- and common -- ethical error the Bishop is making here.

Here is a great clip from this article:

Yet others argue that what really counts here is not the motive, but the results.

American writer Virginia Postrel has been campaigning for it to be legal in the US to pay cash for a kidney from a live donor.

She said: "People want to keep it as a heroic, uncompensated act because it makes them feel good.

"Never mind that tens of thousands of people are dying for your right to feel good about other people's heroic acts."

Postrel's criticism sounds cynical, but she isn't the cynic she appears to be. She donated a kidney to a sick friend, became interested in the idea of a market for kidneys because of her experience with donation.

"The reaction is completely disproportionate to the actual risks involved. People do act like you're completely nuts."

Italics mine... what a great line!

Hillsdale College: Flourishing Without Government Funds

A recent issue of Imprimis, a monthly one-article publication from Hillsdale College with a wide distribution and readership, gave a very readable history of the college. As an atheist I really have no interest in the school's religious aspects (it was formed by Freewill Baptists in 1844, though has been "non-denominational" since its inception). But what I find praiseworthy and remarkable about the school is its refusal to accept government funding -- neither direct federal aid or even indirect aid in the form of student aid from the government. As a result, it remains free of government interference as well. This proves that it is possible to do: always has been possible and remains possible today. This article in Imprimis tells their tale nicely... keep up this principled stand Hillsdale!

John Stossel Responds to Michael Moore

Several recent columns by John Stossel refer to an interview he had with Michael Moore for an upcoming 20/20 piece on health care. In these columns Stossel responds to several of Moore's claims and views, and as always he makes some great points and does so in an enlightening way. The three columns are: Live and Let Live, Freedom and Benevolence Go Together, and Michael and Me. All three are good reads. I'll quote a just a few bits here:

Michael Moore may not have thought about it, but there are only two ways to get people to do things: force or persuasion. Government is all about force. Government has nothing it hasn't first expropriated from some productive person.

In contrast, the private sector -- whether nonprofit or a greedy business -- must work through persuasion and consent. No matter how rich Bill Gates gets, he cannot force us to buy his software. Outside government, actions are voluntary, and voluntary is better because it reflects the free judgment of creative, productive people.

The italics there are mine... what a great line that is! This was from the first column linked above, which doesn't actually spend much time responding to Moore. This is from the second column linked above:

Moore added, "I watch your show and I know where you are coming from. ..."

He knows I defend limited government, so he tried to explain why I was wrong. He began in a revealing way: "I gotta believe that, even though I know you're very much for the individual determining his own destiny, you also have a heart."

Notice his smuggled premise in the words "even though." In Moore's mind, someone who favors individual freedom doesn't care about his fellow human beings. If I have a heart, it's in spite of my belief in freedom and autonomy for everyone.

Doesn't it stand to reason that someone who wants everyone to be free of tyranny does so partly because he cares about others? Wishing freedom to one's fellow human beings strikes me as a sign of benevolence. But Moore and the left don't see it that way.

Moore thinks respecting others' freedom means refusing to help the less fortunate. But where's the connection? All it means is that the [advocate of capitalism] refuses to sanction the use of physical force (which is what government is) to help others. Peaceful methods -- like voluntary charity -- are the only morally consistent methods. I give about a quarter of my income to charities because I've seen that private charity helps the needy far better than government does

That was a good catch by Stossel... the smuggling use of "even though". Stossel continues on, and catches Moore with another smuggled premise:

Surprisingly, he did show an understanding of the importance of the libertarian philosophy to America. "John, your way of thinking actually was great for this country. I mean it; it helped to found the country. It helped build us into one of the greatest nations, perhaps the greatest nation, that the earth has ever seen. Limited government, pull yourself up by your bootstraps, every man for himself, forward movement, pioneer spirit. That's why a lot of people in these other countries really admire us, because there's this American get up and go."

I interrupt here to point out another smuggled premise. Did you catch that "every man for himself" line? America was never about every man for himself. A free society is about voluntary communities cooperating through the division of labor. [A free society] is far from "every man for himself."

After acknowledging that limited government helped make America great, Moore went on to say, "But I don't think that what you believe is what's going to allow us to survive."

He means that if government does not assure people health care and food, our society will disintegrate.

But why would a philosophy that was good enough to build a successful society be unsuited to sustaining that society? Individual freedom, with minimal government, made it possible for masses of people to cooperate for mutual advantage. As a result, society could be rich and peaceful. As the great economist Ludwig von Mises wrote, "What makes friendly relations between human beings possible is the higher productivity of the division of labor. . . . A preeminent common interest, the preservation and further intensification of social cooperation, becomes paramount and obliterates all essential collisions."

Freedom and benevolence go hand in hand.

And then the third column includes this excellent bit of Moore-refutation as well:

America's medical system has problems, but profit is the least of it. Government mandates, overregulation and a tax code that pushes employer-paid health insurance prevent the free market from performing its efficient miracles. Six out of seven health-care dollars are spent by third parties. That kills the market. Patients rarely shop around, and doctors rarely compete on price or service.

Moore told me, "Government can do things right. ... My dad gets his Social Security check every month. Comes not only every month, it comes on the same day through the so-called 'dilapidated' U.S. mail. ... [A]sk your grandparents what they think of Medicare. Although it has its flaws, although it may be underfunded, it's a much better program than the HMO that somebody has."

Underfunded? Medicare has a 75-year $34 trillion unfunded liability! Its costs are growing faster than inflation.

Social Security has a 75-year $5 trillion unfunded liability. These are Ponzi schemes that will be bankrupt before Moore reaches retirement age. The U.S. mail manages to deliver his dad's checks, but compare its performance to FedEx or UPS. The Post Office said it wasn't possible to deliver packages overnight.

I want FedEx health care: innovation, new cancer treatments, hip replacements and pain relief. We get that from private-sector competition, not government lethargy.

Moore said, "You don't introduce profit into your city water department."

He's wrong about that, too. As I wrote in "Give Me a Break", Jersey City, New Jersey's water tasted foul and failed safety tests. City workers said there wasn't much they could do. In fact, water prices would have to be raised ... just to maintain the lousy service they had.

So Jersey City turned its water system over to a for-profit company. Within months it had fixed the pipes government workers said couldn't be fixed, and for the first time in years, Jersey City's water met the highest cleanliness standard. Taxpayers saved $35 million.

The private company could do it better and cheaper because their skills were honed by constant competition.

Private competitors innovate or die. Government workers do what they did last year. That's why I want the private sector to provide my health care. Pursuit of profit will give us our best medicines and medical devices.

I love the very specific New Jersey water example here, as that is a direct response to Moore's rhetorical jab. And then the comparison between the private sector and government employees, which I've marked with italics, is a nice line too.

RIP: JFK Assassination Conspiracy Theories

The Q&A piece in the June 11 issue of US News and World Report is titled "The Final Verdict" and is a brief interview with Vincent Bugliosi, author of a new and massive book about the Kennedy assassination titled Reclaiming History. This interview summarizes his views on the matter, and really does seem convincing. Assuming the 1,696 pages of his book fully backup his views, it seems there can really be no question here. Not that this will silence all the conspiracy theorists (since likely nothing will!).

On the Costs and Benefits of Health Care Regulation

The latest issue of The Economist has both an editorial and then a one-page article on America's health-care system, and the costs and benefits of the tangled maze of regulations we have. The editorial begins by noting that Milton Friedman argued that the FDA was unreformable and hence should be abolished. While I agree with that, those at the Economist do not. But their editorial does go on to make some interesting and sensible reform suggestions:

The starting point is that the FDA and its counterparts across the world need to move from a risk-obsessed, "one size fits all" approach to a more flexible system that considers the risks and benefits of new therapies. Rather than asking drugs to undergo many years of costly trials in the vain pursuit of medicines that are safe for all in all circumstances, regulators should allow speedier conditional approvals. This is especially true for the growing number of targeted therapies, such as several excellent new cancer treatments, made possible by advances in genomics--a science that identifies which genetic groups will benefit from a drug.

If initial tests and sophisticated computer modelling show promise, innovative new drugs should proceed to small human trials. Ultimately, the drug could be approved for use by a wider part of the general population deemed (through genetic testing and other screening methods) to be at relatively low risk or more likely to benefit from the therapy.

Safeguards can counterbalance this relaxation. Faster approval of new drugs in humans should be matched by more rigorous post-launch testing and surveillance. At the moment, the FDA does not have the money or authority to do this properly. Scores of post-launch studies of drugs safety have been requested by regulators, but remain undone or ignored by firms. And yet there is reason to think such post-launch surveillance, if bolstered by the use of electronic records and "data mining" techniques, could save many lives. When Vioxx, a blockbuster pain remedy made by Merck, turned out to be dangerous for some patients, private health-management organisations with excellent electronic patient records spotted the problem months before the FDA did. The second safeguard is for all drugs trials done anywhere in the world--failed or successful--to be made public and the data published online. Consumers would have the information they need to choose whether to take a drug, weighing benefit against risk. Companies would benefit from a cheaper and faster approvals process, and a lower risk of litigation.

By cutting the costs of approval, lighter regulation should help move the industry away from blockbusters towards niche products. A reformed FDA might thus speed the arrival of the long-promised age of personalised medicine. Even if it survived, Friedman would surely approve.

The article in this issue then discusses three recent studies that give real evidence that Friedman's view of the FDA is correct: namely that it does far more harm than good. And we are talking about real physical harm here folks: people's lives would be saved if the FDA didn't do the things it did. See the graph in this article that indicates the total costs and benefits for five major areas of regulation of the US health care system: medical torts, the FDA, insurance regulation, and the certification of health professionals, and health facilities. It even indicates the components of the costs that come from State vs. Federal regulations. In all five of these areas, the costs outweigh the benefits. While medical tort and insurance regulation have greater total costs, this graph indicates that the relative costs vs. benefits are worst for the FDA.

Citing a second reference (a forthcoming paper by Michael Cannon of the Cato Institute), the article notes the important problem with the FDA:

Citing the best evidence to date on the costs and benefits of FDA regulation, Mr Cannon argues that the agency "is too slow and demands too much testing", ultimately harming consumers. He points out that drugs regulators can make two broad types of errors. First, they might approve a drug too quickly, only to find out after its launch that it is dangerous or even deadly. Second, they could delay the launch of a highly innovative drug by demanding onerous or unnecessary trials and thereby deny many needy patients a new therapy.

Proper regulation requires balancing these two risks, but the pitch may be queered by bureaucratic self-interest. If the regulator allows even one drug to slip through the approval process that later proves harmful to some people some of the time, a hue and cry is sure to follow. Look no further than the recent public backlash against the FDA after several deaths were linked to Vioxx, a blockbuster pain remedy made by Merck.

And yet the second (and probably bigger) risk of leaving people untreated because of restrictions on drugs rarely gets the regulators into trouble. As Mr Cannon puts it, "no FDA official has ever been fired or faced a congressional inquiry for delaying the approval of a promising new drug, however unjustified the delay." What is more, he speculates, big drug firms may quietly acquiesce to this burdensome red tape because it acts as a barrier to entry against newcomers without the cash or lobbying power to navigate the FDA.

That is a key point. I'd love to see FDA officials grilled by members in Congress with questions like "Because you took five years to approve drug XYZ, it is estimated that 10,000 people died that would have otherwise lived. How can you defend your slow bureaucracy?" That would be precious... but I'm not holding my breath.

I hope that the FDA will be reformed for the better, though I fear it won't be or that changes will only make the situation worse.

Gas Taxes vs. Gas Profits

On June 6 John Stossel provided another great item, "Why is Profit a Dirty Word?" (thanks to Shawn Klein for this link). He begins as follows:

At a recent press conference Sen. John Kerry was upset as he snarled, "Oil companies in America are reporting record profits. Record profits."

When did profit become a dirty word?

I wish the oil executives would face the media.

They could say something like:
"What are you complaining about? What do you think we do with our profits? Buy fancy cars and homes? Well, we do, actually, but nearly all the money goes to looking for more oil and following environmental rules that you want us to follow. You should want us to make more profit. Anyway, we make less profit per gallon than your beloved government takes in taxes."

This is something I have thought about often: the lack of proper argumentation from those in business when they are attacked by the press or by politicians. And the point Stossel makes here is so ripe for use in response to the likes of John Kerry! "Can you explain your record profits?"... countered by "Sure I can. But if I do will you explain why you feel it necessary to take more in oil and gas taxes than we do in profits?" LOL... the look on the politician's face at that moment would be priceless.

From a Former Fanatic

Here is an interesting piece in The Daily Mail titled "I was a fanatic...I know their thinking, says former radical Islamist" (thanks to Shawn Klein for the link). Written by a former member of what he calls the "British Jihadi Network", the author argues that the primary reason for Islamic terrorism is not the foreign policy of the USA/Western countries, but rather Islamic theology (or at least their interpretation of it). This is of course a vital perspective, and runs counter to what so many on the left argue (and sadly, a great many libertartians, like Ron Paul in the Republican debates a while back). So often we hear that "they hate us because of our foreign policy". Well, the US and other Western countries have certainly made many foreign policy mistakes over the years, and the current Bush administration obviously has too. But people like this author make the point quite clear that these actions are not the primary engine of their violent ways -- their ideology is. The primary issue is cultural/philosophical, not foreign policy.

It'll Function Fine Until the Next Storm

In the May 14 issue of BusinessWeek there was an article titled "Hurricane Ahead, But Lower Insurance", subtitled "Why the price of property coverage is going down in the face of dire predictions". The article notes that even after Katrina and other recent, costly storms:

In most of the country, property insurance rates for homeowners and businesses are actually lower than they were before Katrina. And amazingly, insurance rates have been falling recently in many parts of Florida and the Gulf Coast that stand to suffer severe losses from hurricanes, encouraging continued construction in low-lying areas.

There are some financial reasons given for this, but the other big one is government interference in the market:

Regulators and the insurance industry are only beginning to grapple with the problems of pricing coverage in an era of potentially big storms. By some calculations, actuarially correct premiums would be so high as to freeze economic development in places such as Miami and New Orleans.

But of course that isn't happening, because actual risk calculations are not determining the market. Government regulators are capping rate increases and in some cases "broadening the availability of state-subsidized insurance for highly exposed property owners who can't get coverage from the private market". Consider this:

Under Governor Charlie Crist, Florida has gone the furthest in challenging market forces. In January, the state legislature massively increased government involvement in the insurance business in hopes of rolling back homeowners' rates. It blocked rate hikes by the state-controlled Citizens Property Insurance Corp., which insures people who can't get coverage in the private market. That allowed Citizens to undercut private insurers. To keep private companies from bailing out of Florida, it intends to make available an additional $16 billion in highly subsidized reinsurance from a state fund.

Trouble is, if a series of big hurricanes empties out the Citizens reserve fund and the reinsurance fund, the state will have to raise the money to pay claims via a special assessment of thousands of dollars apiece on all policyholders in the state. "It'll function just fine until the next storm. Then we'll see," says Joshua D. Shanker, an equity analyst at Citigroup Investment Research.

Well, duh. That is a classic line: "It'll function just fine until the next storm. Then we'll see."

How many times have you seen people's homes or businesses destroyed, not by freak occurrences that are hard to predict like a tornado, but by regular occurrences that one should expect in certain areas, like damage from being too close to a river or an ocean? And how often do those people then say, on camera, "Well, it is a tough loss. But we'll rebuild." The many times I've seen and heard this I've always thought two things. First, I'm glad you are picking yourselves up and are eager to rebuild your lives and rebound from disaster. But second, why are you going to rebuild in the same location?!?! How could you afford to do that given the massive increase in insurance that will no doubt hit you... oh wait, it won't, because the government will subsidize you and encourage you to rebuild in that high-risk location. And this will be a cycle that will continue and continue, with billions of dollars wasted time and again.

The article continues:

The political fix temporarily alleviates the financial pain, but it worsens the underlying problem. Developers continue to erect condos in vulnerable parts of Florida in part because of the availability of state-subsidized insurance. Florida already has $2 trillion in coastal exposure and remains one of the fastest-growing states. That will raise the cost of the next Big One. "People have the expectation that insurance is a commodity and should be flatly priced," says Robert Muir-Wood, chief research officer of Risk Management Solutions Inc. But in an actuarially ideal world, he says, the rate for the South Florida beachfront should be perhaps 50 times higher than the rate for an elevated property in northern Florida. "The wealthiest people tend to benefit the most from this aberration," Muir-Wood says.

Meanwhile, the Florida state government's decision to fight the market and absorb more hurricane risk is benefiting other parts of the country. As private insurers and reinsurers are being driven out of Florida, they are writing more policies elsewhere, which is helping to lower rates in other places, like Mississippi.

The dip in rates is not likely to survive another year like 2005. Insurers are being more rigorous in setting rates and paying closer attention to their risk models than in the past, says Timothy R. Gardner, global head of the property specialty practice of Guy Carpenter and Co. The influx of capital could ebb. And if another Katrina-type hurricane hits, regulators and politicians will find it harder to defy nature and enforce unrealistically low rates for coastal property.

Harder, perhaps. But I don't think one more Katrina-level disaster will lead to change in this system. A change in thinking is what is needed, not just more financial disaster and hardship -- and I don't think just one more massive-damage event will get the relevant parties' thinking to change. Government needs to get out of the insurance-subsidizing business, and individuals and businesses need to stop building and re-building in such high-risk areas. If you are wealthy and can and want to take the risk -- either by not having insurance or by buying expensive insurance that is priced according to the actual risks involved -- then fine. But anything other than that is an evasion of reality. I mean, do people expect the government to subsidize the insurance for their new home or business that they want to build on the side of an active volcano? I'd like to think that the obvious answer there is "of course not", and the essence of the situation in Florida and other high-risk areas is relevantly similar. Live there without an insurance safety net, pay the price for your insurance safety net, or don't live there at all.

HR 2046 and Poker

I heard recently that there was a new bill up in the House to try and save or protect online poker. So I went to the Poker Players Allliance website to get some info, and at this page they provide the following info about HR-2046 "The Internet Gambling Regulation and Enforcement Act of 2007":

HR 2046 protects poker players. Applicants for a gaming license would be required to provide comprehensive financial statements and corporate structure documents, and to agree to be subject to U.S. jurisdiction and all applicable laws related to Internet gambling. No license would be granted to any applicant convicted of a criminal violation of any law relating to gambling, money laundering, fraud or other financial laws.

HR 2046 protects consumers. The framework set forth in the bill would for the first time effectively regulate Internet gambling, thus making it possible to address underage and compulsive gambling, neither of which are prevented under prohibition regimes. Regulation combined with proven technology would establish a system of effective controls to block children and compulsive gamblers from gambling.

If HR 2046 becomes law, online poker will be safe, secure and regulated. The bill would create stringent licensing to ensure that poker operators are legitimate. HR 2046 protects poker players, and it protects consumers.

This might not be exactly what I'd like to see happen, and I'm against government regulating the economy and the actions of consenting adults. But passing this into law would be better than the current situation, because last year's legislation -- slipped into other legislation and passed under the cover darkness -- has made it far more difficult for Americans to play the great game of poker online. So given the choices of only regulation or prohibition, I'll of course go with regulation.

The PPA continues to provide great info on the issue of poker and the law, and I really wish them success in the fight with congress. Their homepage provides the following "Important Facts Congress Should Hear", with links to supporting info and argumentation:

• Poker is one of the great American pastimes. The game has been enjoyed by presidents, generals, Supreme Court Justices, Members of Congress and average Americans for more than 150 years.
• Poker is a game with a predominance of skill. Like chess, poker is a "thinking man's" game which relies on mathematics, psychology and money management.
• Poker is a source of charity. In 2006, millions of dollars were raised for local and national charities through poker tournaments. One event in D.C. featuring 15 Members of Congress raised more than $288,000 to fight cancer.
• Billions of tax revenue is being lost. According to an economic analysis, 3.3 billion in federal tax revenue and addition 1 billion in state tax revenue could be raised if the federal government were to regulate Internet poker.
• 75 percent of Americans oppose banning online poker. According to national polling, a vast majority of Americans oppose federal efforts to ban online poker.
• Supporting an online poker ban can cost you an election. Exit polling has shown and the national media has noted that a leading advocate to ban Internet poker in the 109th Congress was negatively impacted by his leadership on the issue.

Those are all fine points to make for the purposes of trying to win votes in Congress. Different legislators might be swayed by some or all of the above. I think the second point is particularly important, because it is relevant to the total hypocrisy in last year's legislation, and in the politician's attitudes towards gambling in general: they allow horse-racing and state-run lotteries, but not games like poker. And yet, the lottery is completely a game of chance, while poker is a game where skill plays a major role. So how is the lottery OK -- not just OK, but state-run! -- but poker is banned? That is just ridiculous, pure and simple.

But as valuable as the above bullet points might be to convincing this or that legislator, the real reason that online gambling -- indeed gambling as such -- should be legal is a matter of individual rights. It simply isn't the proper role of government to keep two or more free adult people from doing something that isn't violating the rights of anyone else. The arguments in favor of gambling prohibition have always been and will always be invalid. It is the role of government to protect people from mistakes they might voluntarily make. Nor is it acceptable for a particular morality to be imposed upon individuals by law -- and that quite clearly from the history of gambling prohibitions is a large part of the issue here: conservatives, particularly religious conservatives, imposing by force their view that gambling is somehow immoral.

We often talk about separation of church and state, because that is how it was worded in founding American documents. But what really matters, philosophically, is the underlying separation, the necessary separation between religion and law.

Gas Prices "Too High"?

The Ayn Rand Institute's Alex Epstein recently wrote a good op-ed piece titled "What to Do About Rising Gas Prices". Here is an excerpt:

There is no moral or economic justification for any politician or consumer to declare market prices "too high," and to use the government to coerce lower prices. To do so violates both the rights of gasoline producers and their productive customers to set voluntary prices -- and, in doing so, causes destructive shortages. When shortages exist, how much gasoline one is able to get depends not on one's willingness to pay a mutually agreeable price, but on one's political pull to secure rations, or on whether one has time on one's hands to wait in endless lines (as in the 1970s).

There is only one sense in which we are entitled to tell the government to "do something" about gasoline prices: insofar as these prices are made artificially high by the government's many regulations on oil and gasoline production.

He then goes on to cite a few such regulations that cause the price of gasoline to be as high as it is, and the concludes: "What should the government do about gasoline prices? Get its hands out of the market--and keep them off."

On the Right to Assisted Suicide

During the week that Dr. Jack Kevorkian was released from prison, The Ayn Rand Institute had both a press release, and an op-ed "The Right to Assisted Suicide" Thomas Bowden. Both are excellent.

From the Op-Ed:

What lawmakers must grasp is that there is no rational, secular basis upon which the government can properly prevent any individual from choosing to end his own life. When religious conservatives use secular laws to enforce their idea of God's will, they threaten the central principle on which America was founded.

The Declaration of Independence proclaimed, for the first time in the history of nations, that each person exists as an end in himself. This basic truth--which finds political expression in the right to life, liberty, and the pursuit of happiness--means, in practical terms, that you need no one's permission to live, and that no one may forcibly obstruct your efforts to achieve your own personal happiness.

But what if happiness becomes impossible to attain? What if a dread disease, or some other calamity, drains all joy from life, leaving only misery and suffering? The right to life includes and implies the right to commit suicide. To hold otherwise--to declare that society must give you permission to kill yourself--is to contradict the right to life at its root. If you have a duty to go on living, despite your better judgment, then your life does not belong to you, and you exist by permission, not by right.

For these reasons, each individual has the right to decide the hour of his death and to implement that solemn decision as best he can. The choice is his because the life is his. And if a doctor is willing (not forced) to assist in the suicide, based on an objective assessment of his patient's mental and physical state, the law should not stand in his way.

And then commenting on Oregon, the one state that has "provided clear procedures by which doctors can end their dying patients' pain and suffering while protecting themselves from criminal prosecution", Bowden continues:

Religious conservatives' opposition to the Oregon approach stems from the belief that human life is a gift from the Lord, who puts us here on earth to carry out His will. Thus, the very idea of suicide is anathema, because one who "plays God" by causing his own death, or assisting in the death of another, insults his Maker and invites eternal damnation, not to mention divine retribution against the decadent society that permits such sinful behavior.

If a religious conservative contracts a terminal disease, he has a legal right to regard his own God's will as paramount, and to instruct his doctor to stand by and let him suffer, just as long as his body and mind can endure the agony, until the last bitter paroxysm carries him to the grave. But conservatives have no right to force such mindless, medieval misery upon doctors and patients who refuse to regard their precious lives as playthings of a cruel God.

Secular and rational state legislators should regard the occasion of Dr. Kevorkian's release from jail as a stinging reminder that 49 of the 50 states have failed to take meaningful steps toward recognizing and protecting an individual's unconditional right to commit suicide.

More on Elon Musk, and What is Wrong with NASA

Back in April I blogged a bit about Elon Musk, after learning a bit about this amazing entrepreneur in Wired magazine. So I was pleased to see the latest issue of Wired have a cover story titled Rocket Boom, which goes into more detail about Elon Musk's efforts to build privately-funded space rockets. It is a well-written piece, as it gives a glimpse of what his work is like in this field.

And another, shorter item in that issue is also worth reading: How NASA Screwed Up (And four ways to fix it). Author Gregg Easterbrook really makes clear the failings of NASA -- not just failed projects, but more importantly its misguided priorities for projects going forward. Consider the moon-base plan, being pushed by George Bush:

For a sense of how out of whack NASA priorities have become, briefly ponder that plan. Because the Apollo missions suggested there was little of pressing importance to be learned on the moon, NASA has not landed so much as one automated probe there in three decades. In fact, the rockets used by the Apollo program were retired 30 years ago; even space enthusiasts saw no point in returning to the lunar surface. But now, with the space station a punch line and the shuttles too old to operate much longer, NASA suddenly decides it needs to restore its moon-landing capability in order to build a "permanent" crewed base. The cost is likely to be substantial -- $6 billion is the annual budget of the space station, which is closer to Earth and quite spartan compared with what even a stripped-down moon facility would require. But set that aside: What will a moon base crew do? Monitor equipment -- a task that could easily be handled from an office building in Houston.

In 2004, former astronaut Harrison Schmitt, now an engineering professor at the University of Wisconsin, calculated that NASA can place objects on the moon for $26,000 a pound. At that price, each bottle of water a crew member uncaps will cost the taxpayer $13,000. Even if the new moon rocket being designed by NASA cuts launch costs in half, as agency insiders hope, that's still $6,500 for one Aquafina (astronauts and moon base are extra). Prices like this quickly push the total construction bill for any serious facility into the hundreds of billions of dollars. A private company facing such numbers would conclude that a moon base is an absurd project -- at least until a fundamentally different way of reaching space is found -- and would put its capital into the development of new propulsion technologies. But NASA takes a cost-is-no-object approach that appeals only to those who personally benefit from the spending.

Although the article begins by laying out several projects that would be more rational for NASA to focus on than what it currently has as its priorities, I was glad to see the article end with the following emphasis on the need for a turn away from NASA and towards the private sector:

Given NASA's politicization, we should hope that the space industry evolves as aviation did — transitioning from ponderous government-run projects to mostly private-sector activities attuned to customer needs. That raises the question: Could entrepreneurs like Elon Musk and Jeff Bezos eventually put NASA out of business? Perhaps, but not for the next couple of decades — space has colossal economic barriers to entry. Given that NASA is sure to be around for a while, taxpayers should insist the space agency be recon figured to produce tangible benefits for all of us. With any luck, private space enterprise will eventually find success and begin to exert competitive market pressures on the government space program. NASA's success in putting men on the moon in the 1960s is one of history's enduring achievements. But it's the 21st century now — long past time for a new set of space priorities.

Walter Williams on the FDA

Walter Williams makes some good points in his article FDA: Friend or Foe? In particular, he notes the following tension:

Some drugs are highly beneficial to certain patients but pose an unacceptable risk to others. ... So if you're an FDA official, what are your incentives in terms of whether to approve or disapprove the marketing of a drug that has a tremendous benefit to some patients and poses a health threat to others?

Former FDA Commissioner Alexander Schmidt hinted at the answer when he said, "In all our FDA history, we are unable to find a single instance where a Congressional committee investigated the failure of FDA to approve a new drug. But the times when hearings have been held to criticize our approval of a new drug have been so frequent that we have not been able to count them. The message to FDA staff could not be clearer."

There's little or no cost to the FDA for not approving a drug that might be safe, effective, and clinically superior to other drugs for some patients but pose a risk for others. My question to FDA officials is: Should a drug be disapproved whenever it poses a health risk to some people but a benefit to others? To do so would eliminate most drugs, including aspirin, because all drugs pose a health risk to some people.

He also notes that the FDA lately has been rejecting drugs because they aren't unique enough from what is already on the market. To which he responds:

According to the FDA's literature, its mandate is: "Once a new drug application is filed, an FDA review team — medical doctors, chemists, statisticians, microbiologists, pharmacologists, and other experts — evaluates whether the studies the sponsor submitted show that the drug is safe and effective for its proposed use."

Nothing in the FDA mandate requires that a drug has to be better than what's currently available in order to win approval.

Henderson and Hooper argue that in the worst-case scenario where Arcoxia is no better than existing drugs, it would compete with those drugs. Two centuries of economic theory and evidence show that competition is good. A new drug that competes with existing drugs would moderate drug prices and cause competitors to stay on their toes.

Say on Pay?

Yaron Brook has written an Op-Ed attacking the Say On Pay bill that has passed in the US House of Representatives. The Op-Ed ran in modified form here at Investment News. The bill would force all corporations to allow shareholders a non-binding vote on CEO compensation, the idea being to shame directors in lowering CEO pay. While this bill itself might not do much -- since it forces only non-binding votes -- this bill would appear to be only a first step. As Brook notes, the Rep who proposed it, Barney Frank, has supported outright caps on CEO pay and "has threatened that if 'say on pay' does not sufficiently reduce CEO compensation relative to that of other employees, 'then we will do something more.'"

Brook's piece is a good read, and he notes several things that shareholders can do already if they are unhappy about the pay of a CEO, none of which require further regulation of business by government:

1. "Vote with his dollars" by selling his shares
2. Accumulate a controlling interest in the company (typically 51%) and impose a new board of directors
3. Persuade a majority of shareholders to replace the board with people sympathetic to their concerns.

Two Views of "Culture of Life"

Debates about abortion, euthanasia, assisted-suicide, and stem cell research are often so emotionally charged, and filled with straw men on both sides, that it can be hard to separate the wheat from the chaff -- to pin down the core philosophical issues, the key points that matter, and ignore the rest.

Alex Epstein of the Ayn Rand Institute wrote an Op-Ed titled "The Religious Right's Culture of Living Death" on these issues recently, attacking what he presents as a generalized "religious right" position. Not a piece of philosophical argumentation, it doesn't get into the key questions of personhood, individual rights (including the right to life), the role of government, and so on. That was not its purpose. Instead it is a rhetorical piece that raises a very interesting question about the phrases "Culture of Life" and "Culture of Death" -- phrases often used by those on the so-called "pro-life" side of the debate.

What Mr. Epstein writes is quite powerful I think -- and it certainly isn't something you read or hear coming from those on the "pro-choice" side of the Abortion debate, or the pro-research side of the stem-cell debate. While I encourage you to read the entire op-ed, the second half is provided below. After separately attacking what he sees as the "religious right's" position on abortion, euthanasia, and stem-cell research, he then writes:

To uphold these positions in the name of the sanctity of life is a colossal fraud. A "culture of life" would not benefit human life, but cause massive suffering and death.

What could possibly justify the religious conservatives' crusade for such a world? "God's will," they answer. Our lives belong to a supernatural being, they say, and He commands us not to end them "unnaturally," no matter how unbearable they become. He sanctifies bits of protoplasm, they say, and thus commands young women to abandon their ambitions in order to raise unwanted children, and commands everyone to abandon the breathtaking promise of a new field of research.

This is the rise of the same medieval mentality that demanded rejection of the life-enhancing developments of anesthesia, the dissection of corpses, and birth control.

The religious conservatives do not value actual human life; they are consistent followers of the Christian ideal that human life is properly lived in sacrifice to a supernatural being, and that suffering is proof of virtue. The worship of suffering is fundamental to Christianity, a religion whose central figure is glorified for dying a horrific death for the sins of mankind. Several years ago, a prominent religious conservative said of the Schiavo case, "Terry Schiavo . . . is suffering in obedience to God's will." He added: "Isn't suffering in pursuit of God's will the exact center of religious life?"

This is the culture of death--of living death.

Human life is sacred--not because of supernatural declaration, but because of the unique nature and glorious potential of the individual, rational human life: to think, to create, to love, to experience pleasure, to achieve happiness here on earth. A genuine culture of life would leave individuals free to pursue their own happiness--free from coercive injunctions to sacrifice themselves to religious dogma. Such a culture is what we must seek to create, as we do everything possible to fight religious conservatives' culture of living death.

This is powerful stuff. The next time someone on the Christian "religious right" speaks of the "culture of life" and of being "pro-life", ask them what their philosophical position is on sacrifice and suffering. Of course most Christians today would not say that they are in favor of suffering (thankfully), but the most consistent ones, and some of the most famous ones, explicitly do: Mother Teresa for example.

Depressed About Antidepressent Warnings

For a while now I've heard about how certain anti-depressents, the SSRIs I believe in particular, are said to "increase the risk" of suicidal thoughts and/or suicide itself in teenagers and children. I've been quite skeptical of any studies that are reported as supporting these contentions. Now today the news is announced that the FDA is expanding this warning for anti-depressents to include "young adults" as well -- those 18-24 -- during the first month or two of treatment.

Now, granted I'm not a doctor. Nor a scientist involved in such medical studies. Nor someone who is otherwise an expert in this area.

Having said that, I think I have good reason to be suspicious. First of all, I think we should all be pretty skeptical of much of what the FDA says: as a large government bureaucracy, and one that causes (or are at least morally responsible for) a great deal of harm and death by holding back helpful drugs for years and years, they don't inspire confidence generally speaking.

But even if you do hold the FDA in high regard... I must ask: have you yet heard reports on this issue that make any sense? They always speak in very vague terms about "increased risk" and so on. When you read further or dig into the underlying data, you find out that the "risks" are still very low.

More importantly, the word "risk" is tossed around as implying that some sort of actual causation has been shown -- of if not proven (which it hasn't been at all), then at least a strong statistical effect has been determined. But I am highly skeptical of this, and here is why. How would studies be done on this in a rigorous scientific way? From what I understand of SSRIs, they are slow acting -- meanings days and weeks, not hours. An increasinly depressed person, who actually gets to a point where they visit their doctor and are prescribed an SSRI, are likely going to continue to get worse before they get better -- caused by the depression itself, not from the drugs they've been prescribed!

Another reason to be skeptical here is that many times I've read of extreme cases of actual suicide or violence for new patients on SSRIs, but often when you dig into those you find out the person didn't follow the prescribed amount. With SSRIs you are supposed to slowly ramp up your dosage (and then slowly ramp it down when you are coming off of it). If you take five times the amount prescribed, then it is easy to see how that could cause problems.

And lastly, the FDA is the organization behind regulating and demanding all those ridiculously long listings of supposed "side effects" for every drug ad you see on TV or in magazines (if you can even read them, as they are often filled with legalese and printed in 2-pt font). Some instances of this are better than others, but I think their definition of "side effect" is likely wrong-headed, their ability to interpret statistics dubious, and their understanding of real, scientifically valid causation nearly non-existent. Its gotten to the point where comedians now are making fun of such side-effect listings for the jokes they often are. And then there are the high-profile court cases where people sue for heart attacks from this or that medication, many of which quietly get decided later in favor of the pharma company because the person was obese pounds and had every other actual heart disease risk known to man.

Prescription drugs can do harm, no doubt. And I consider it logically possible that SSRIs are actually causing increased suicidal thoughts in young people during their initial weeks or months taking them. But I am not at all convinced that we have any actual evidence of this at all, and I find it much more plausible that what is really happening is that people who are increasingly depressed and start taking the medications continue to get worse -- from their depression -- before the positive benefits of the drugs kick in.

So the next time you read or hear a news item speaking vaguely of studies that indicate "side effects" or "increased risks", and especially if the FDA is touting it, dig a little deeper, and ask if there is evidence of actual, proven causation -- or just some fairly weak, and perhaps grossly misunderstood statistics?

Internet Radio on Life Support?

Is so-called "Internet Radio" on life-support? It seems that unless a new bi-partisan bill introduced in congress, the Internet Radio Equality Act from Jay Inslee (D) and Donald Manzullo (R), is passed by July 15th... well, a great many outstanding Internet music sites will quickly go bankrupt and be out of business. Most notably for me would be the harm this could cause Pandora, a service I have quickly grown to love, as my recent blog posting described.

See this article, and this one, and this one for info on the situation. More recently than any of these it was announced that the feared May 15th deadline was actually a July 15th deadline, so that gives the SaveNetRadio.org group and others time to fight to get the new bill passed. Doing so would essentially cancel the decision of the federal Copyright Royalty Board, which had determined to hike up fees for web streaming radio stations like Pandora and many others. The new fees are bizarre -- they are per song rather than based on profits (thereby treating streaming like downloading), and they are totally out of whack with (higher than) the fees charged statellite radio and traditional AM/FM radio.

A few comments... first, I wish that we didn't refer to sites like Pandora as "Internet Radio". I mean, "radio" is a particular technology. It isn't used by the Internet to stream music. Calling sites like Pandora "radio" is confusing and based on inessential similarities. Yes, it is similar in that the music (or other content) is streamed rather than downloaded permanently. So lets call such services Internet Streaming services or Music Streaming services or whatever. That is accurate -- calling them "radio" is confusing.

Second, how many people know much about the federal Copyright Royalty Board? That sounds like something out of a socialist or communist country! What are a bunch of government bureaucrats doing dictating to anyone what they must pay to other people for streaming copyrighted content? Can't the two parties involved contract with each other? I'm not in favor of theft of intellectual property -- but equally wrong is government intervention in the economy... and for the same reasons: both are violations of individual rights.

The third news item linked above has the following bit worth quoting here:

Anyone who spends more than an hour a day in a car -- and there a lot of you in Miami -- knows that commercial radio stations are horrid purveyors of mainstream schlock. Internet radio has made new artists, genres, and songs available to listeners all over the world. Artists have a new way to get their music out there, and small distributors have a way to wrangle in new customers.

Sites like Pandora, which uses the innovative Music Genome Project to create specialized radio stations for its six million users based on what they tell it about their musical tastes, are a blessing to music junkies everywhere.

"We can't continue, at the new rate we can’t sustain the service," said Pandora founder Tim Westergren from Washington D.C., where he is attending congressional hearings on the fee hike. "We are losing money now, even at the old rate, we were looking at another two years before we expected to be in the black."

If the new rates go into effect, and sites like Pandora and W305 shut down, it would be a huge loss for music lovers, and perhaps an even bigger blow to musicians struggling to get their music to the public. A lot of smaller, independent Internet stations may go underground and avoid paying licensing fees all together, Kalimi said.

Maximize Absolute Rate of Growth, Not Relative Rate

The April 14-20 issue of The Economist had a good, brief editorial "Come in Number One, Your Time is Up" (subscription required, but also available here). It discusses the various ways that America is being pushed off its economic pedastal, whether by some European countries, China, or whoever. The last two paragraphs, subtitled "A Winnner in Second Place", are worth quoting:

There will be plenty of hand-wringing in the years ahead. But does being the biggest economy matter? It helps to ensure military superiority; it gives a country more say in fixing international rules; and as the issuer of the main reserve currency, America can borrow more cheaply. But being number one cannot be an end in itself. The goal of policy should be to maximise a country's absolute rate of growth, not its relative rate.

Losing top place in the economic league is different from being beaten in sport, where for every winner there is a loser. Economic competition is not a zero-sum game. China's economy will overtake America's not because the United States is in terminal decline, but because China is catching up. And faster growth in China and other emerging economies will benefit America's economy, not harm it. If an obsession with remaining number one foolishly caused America to adopt protectionist policies, that would reduce America's growth as much as China's. It is better to be number two in a fast-growing world than number one in a stagnant one.

Some Consumers Unable to Buy Caviar

Lately I've been reading numerous articles about the collapse of the "sub-prime" mortgage/loans/housing market, and the impact of this on the "alternative" loans market and even the broader market. Some articles or news items on TV covering this have been better than others, naturally. The ones that annoy me are the ones that lament the situation without asking the important questions of how we got into this situation in the first place. This seems to be yet another example of journalists becoming more and more lazy -- because I refuse to believe that news consumers (you and me) are not asking for this kind of information in news reports on issues like this.

The subprime loan situation seems to be at least in part another instance of government intervention in the economy producing unintended, negative side-effects. This is another Hardy-moment, "This is another fine mess you've gotten me into!" -- a quote that I have thought of more and more in recent years when considering well-intended government programs that end up doing far more harm than good (above and beyond the inherent violation of individual rights that they involve in the first place).

The banking/loan/housing industry is of course far from a laissez-faire capitalist system. On top of that, the government in the US has been promoting more and more home ownership for many, many years now. Well guess what? Not everyone has the financial ability to own a home. To do so, unless you can pay in cash upfront, you need a loan. To get a loan you pay interest and rate of interest must rationally be based on what kind of risk you represent to the bank giving you the loan. This is all very simple economics folks! The more the government promotes, subsidizes, encourages, etc., more and more people to own their own homes, the more risky loans are going to be made. As base interest rates rise, and if people do not have fixed rates, then the inevitable will occur -- people won't be able to pay for their loans, banks will foreclose on homes, and dreams will be shattered. This is a simplification of the current situation, but it captures the essence I think.

And this is entirely predictable of course -- again, it is basic economics.

As an example of the kind of news article I'm talking about, consider the one in last Sunday's Rochester Democract and Chronicle, titled "Not 'Sub', Not Prime" which ran on the front page of the business section. It is a story about those with "Alternative Loans", which are kind-of between "sub-prime" loans and regular mortgage loans. In particular, Matt Drouin is profiled -- a 23-year old who lived with his parents for a while (a brief while it seems) after college to save up some money to buy a home. Because has virtually no credit history -- since he is only 23 years old! -- he doesn't qualify for a regular loan, and can only buy a home with an "alternative loan" that has higher interest rates of course. (How many single 23-year olds own their own homes vs. rent apartments I wonder?)

So what annoys me here is... why is this news? Why does this warrant an article in the paper? I mean, some people are not in a financial position to buy XYZ -- so we report on it? Since when? I don't recall seeing articles with titles like "Some Consumers Unable to Buy Caviar", or "Some Local Residents Priced Out of the BMW Market", or "The Poor Find they are not able to Attend Football Games Every Weekend". Isn't this all obvious? If you are poor, you can't buy things that cost a lot. If you are young, you have no credit history -- and unless you have a really high-paying, secure job, you are therefore a major credit risk for banks. Ergo, you will not get a good interest rate on a major loan (like a mortgage loan).

The sub-title for this article was "Some home buyers must settle for 'alternative' loans". You can almost here the "sigh" being voiced in that subtitle -- as if, the world is unfair, and maybe, just maybe, something should be done about it.

Only buried on page four do we have the all-important point being made:

But the availability of subprime and alternative loans has boosted the nation's number of home owners, with 69 percent of households owning their own homes. "For the past two decades, the emphasis by our government has been home ownership," Nothnagle [local Realty giant] said.

Wow... 69% own homes? I knew the number was artificially high these days -- that is, not what the market would bear without government interference in various ways -- but I had no idea it had reached nearly 70%. We can all agree that owning a home is a good thing, generally speaking -- rather than throwing money away in rent, you are investing in property that you will one day own outright. But just because something is good in this general way doesn't mean that everyone, or even 70% of people, can just magically obtain it. Because the markets represent reality, government interference with them amounts to attempts to interfere with reality -- and that can only have consequences at some point down the road. The chickens come home to roost.

Making this same point recently was a brief Letter to Editor by David Holcberg from the Ayn Rand Institute from 3/30, titled Lenders are Damned if they Lend, and Damned if they Don't:

With 2 million homeowners defaulting on their mortgage payments, we are increasingly hearing denunciations of lenders for having loaned money to people who had no means of paying it back. But these denunciations reveal a disturbing double standard. For years, politicians pressured lenders to not discriminate against those with poor credit history and shaky finances. Now we have the despicable spectacle of politicians accusing lenders of not having discriminated enough and of having made too many risky loans.

Lenders are damned if they lend--and damned if they don't. Whatever lenders do, politicians seem to always find their practices objectionable, and will take advantage of any excuse to call for more regulations and increased political power over lending. Politicians should leave lenders alone, and instead of damning them, they should acknowledge their crucial role in making home ownership possible for so many people.

A NY Poker Warrior and a NY Gambling Hypocrite

Two bits of news caught my attention recently, both related to gambling, and both related to NY politicians. First, see this announcement from the Poker Players Alliance that former US Senator Alfonse D'Amato has joined the PPA as their new Chairman of the Board. He is described as "a passionate and skilled poker player who loves to win in both poker and politics." I can only hope that this increases the chances that the PPA can have positive influence in getting Poker recognized as a game of skill in the federal legislatures. While my first choice would be that it be simply made legal, I am willing to accept "taxed and regulated" as an alternative to the current direction of banning the game. The new law enacted in 2006 doesn't literally do that, but it makes it illegal to transfer money into gambling websites, thereby essentially making the game illegal for Americans to play online.

As I've said before, this sort of law is wrong for countless reasons. Most fundamentally it is a violation of individual rights since playing poker online is an act that does not violate others' rights, therefore no law should be enacted to prohibit. But even if you don't agree with this minimal-government philosophy, consider that the law is entirely hypocritical by allowing for horse-racing and state-run lotteries (which takes no skill at all!), and will be a complete failure in attempting to protect problem gamblers and children: online gambling will continue, but will be done deeper underground, supplied by less-reputable companies. Further, the billions of dollars in tax revenue that could be obtained from a "tax and regulate" approach is being lost, as is the good that money could be used for to help problem gamblers.

This is all quite obvious, and I can only hope that former Senator D'Amato can hasten the day when that law will be repealed, or at least when poker (and similar games) will be carved out of it with additional legislation that regulates and taxes them. But self-righteous social conservatives, often driven by irrational, mysticism-driven ethics, have once again imposed their views on all Americans, and in the process violated our individual rights (this happened countless times throughout our history -- just think of all the actions that violate no one's rights, but are nonetheless against the law, or were at various times in our history).

The other story was reported in various places, but I saw it as the third tidbit from the "Cross Country" section in the March 5 issue of US News and World Report, "Rolling the Dice on Indian Gambling". Here we learn that newly elected NY Governor Eliot Spitzer has endorsed the building of an Indian-run casino in the Catskill Mountains. It is predicted that it will generate $100 million in revenue for the state, obviously a big reason for the endorsement.

This is not particularly interesting news for me all on its own, until I learn that it will be run by the St. Regis Mohawk Mohawk tribe, and that its location will be 400 miles from the Mohawk reservations. This is dubbed an "off reservation" casino, something that Interior department opposes. It is unclear whether they will allow such things it seems.

At what point will this country wake up and ask the fundamental question: why can't American citizens, people like you and me, start our own casinos, hold poker matches (online or in-person), and so on? I'm not ignorant of the obvious facts here: it is illegal in most states, but is not illegal on Indian land since they are considered "sovereign states". For a governor to stretch this and endorse Indian people running a casino on non-Indian land... can't we see the obvious flaw in our laws?

Why is some gambling illegal, but not others? Again, this is a violation of our rights and always has been! Horse-racing is legal, slots are not. State-run lotteries -- which are entirely luck-based -- are legal, but poker -- a game of both luck and skill -- is not. The hypocrisy of this is mind-boggling!

I realize that the fight to legalize gambling is a massive uphill battle. Not only are social conservatives and religious fanatics against it, but presumably the Indian tribes would be as well. And some interests in Vegas and Atlantic City, at least at first, until they realized they might profit in the long run. But all of this is irrelevant to both the principle and the practicality of the matter at hand. The law against gambling in this country is a violation of our individual rights, and alway shas been. And like all laws against "crimes" that are in fact not rights-violations at all, the law against gambling is impractical and counterproductive: it forces gamblers further underground, creates a black-market, keeps those with problems (in this case problem gamblers) from seeking help, and fails to produce revenue through taxation that could be used to combat any negative externalities that are created. Again, ideally gambling would simply be legal for adults to partake in, but like cigarettes and alcohol, legalization through a "regulate and tax" scheme is preferable for everyone to the current scheme of prohibition and blatant hypocrisy.

Libertarian Party Hysterics

I haven't been a member of the Libertarian Party for many years. One could still call me a "libertarian", depending on your meaning in using that name, since I believe in very minimal government -- essentially government should protect individual rights, and do nothing else. But as many have before me, I increasingly shy away from using the word "libertarian" to describe myself. I won't go into all the philosophical reasons for this now, nor will I comment on specific policy differences I have with others who go by the name "libertarian".

For now I just thought I'd comment on what I see as increasing hysterics from the official Libertarian Party in this country. While I was a member of that party for a few years, I haven't been for sometime now. Nonetheless I still get some of their mailings, either by mistake or because they are hoping I will re-join. So I recently received their 2006 Annual Report. First, a few mundane positives and negatives. They wrote it with some elements of a comic book style -- the title of the slick brochure is "2006 Adventures in Liberty", the cover shows a Clark-Kent-like man tearing off his shirt to show the LP logo underneath, and there are a few images inside that also evoke this design theme. So that is a clever idea. On the flip side, if I were a member of the party, I would have preferred to see more actual data -- about membership numbers, budget revenue and expenditures, and so on, with charts comparing 2006 with the last few years.

But what I really found disconcerting was some of the content. Granted, this "annual report" is really intended to generate revenue. It needs to stir up the emotions of those that read it, to dig as deep as they can, and send in money to the support the activities of the party for the coming year. So any organization or party is going to mention only the good things they did last year, the achievements, and spin the heck out of them, including referring to any negatives as challenges for growth, opportunities, or whatever.

But as I've seen with the LP for years now, they do this to the point of hysterics. On page one they say "Several times throughout 2006, our liberty was blatantly robbed in front of the world. Such was the case this past October when, as the cameras rolled, President Bush signed the Military Commissions Act that suspended Habeas Corpus... our main protection against unlawful imprisonment."

Really? He did that? Funny I didn't hear about that. Now look, I betcha I'm against various things in that Act, since I disagree with the Republicans and Bush on a heck of a lot of things. But this is hysteria. The implication here is that "our" habeas corpus protection was taken away -- and "our" here can only mean US Citizens.

But this is just wrong. Even the libertarian legal scholar Robert Levy, at the libertarian Cato Institute, argues that it only applies to non-citizens. And the leftist organization Human Rights Watch, which was of course against the MCA, admits as much.

Oh, and they actually give several examples of actions that they argue one day might get your habeas corpus rights stripped away because of MCA, including organizing an anti-war rally or even simply donating to the LP. Come on now... what a crazy fear-mongering!

Or consider the LP's delusions of grandeur regarding their role and success in the November 2006 elections. Here is what they say:

Control of the U.S. Senate was decided by a single seat. Nationwide, third party candidates "beat the margins" in three Senate races. In two of the three races, LP candidates earned many more votes than the margin of victory, thereby deciding the outcome. ... Make no mistake, Nancy Pelosi and Senate Democrats owe their victory to Libertarian candidates."

This is pathetic. You don't have to be a PhD in political science (I'm not one) to see the basic flaw in reasoning here. The mistaken assumption here is that all those people who voted for the libertarian candiate would have voted for either the Republican or Democrat has the Libertarian Party's candidate not been in the running. But this is of course not true. Many would have voted for another third-party candidate, and many would have simply stayed home and not voted at all. It is one thing to say that Ross Perot had an impact on determining the 1992 Presidential Election -- he got a huge number of votes! But simply having the same or more votes than the difference between the Republican and the Democrat candidates is not enough to claim your candidate was key to determining the outcome.

Not to mention that a third party candidate could have reached that status with a very low vote total, e.g., a large-statewide race that is decided with the Democrat beating the Republican, or vice-versa, by say just 500 votes. If the LP candidate got 505 votes, well wippee-doo... that isn't very many votes! You need to tell us how many votes your guy or gal actually got, and how many above and beyond the difference between the two major party candidates that is, before we should begin to be impressed.

But the LP has been touting this increasing level of success and its "emerging as a force" in politics for years and years. And yet, the real results still fail to impress any objective observer. For instance, years ago the party had as a stated goal to be on the ballot in all 50 states for a presidential election. But now I notice that in 2008 their goal is to be on the ballot in at least 45 states. I do sympathize with them in that it is insanely difficult for third-parties -- even relatively strong ones like the LP -- to gain ballot status in many states. But it is worth noting this lowering of their sights for 2008.

Again, I don't fault them for focusing on the positive in their annual review and fundraising brochure, but I wish they'd stop exaggerating their success/influence, making hysterical claims, and obscuring their year-to-year goals. That said, even if they did alter their rhetoric in these ways, I still wouldn't re-join the party. While I naturally agree with a great many of the LP policy presciptions, at least on the surface, I have some important and fundamental disagreements with them, some of which lead to differences of political position and policy as well. So I don't see myself re-joining the LP anytime soon!

Library Is No Place for Government... Except Funding Apparently

I rarely comment on a local story, but since this one so easily speaks to philosophical principles, I will do so this time. Monroe County Executive Maggie Brooks expressed her shock that downtown library patrons could view explicit porn over the Internet in plain sight of kids. She then took what is being characterized by many as the "grandstanding, heavy-handed" approach of threatening to pull the library's government funding (effectively threatening to shut the library down it seems) if they didn't tighten up their policy in this area.

A columnist in my town's local weekly paper, Benjamin Wachs, wrote a nice, sarcastic column on this issue. In it he defends free speech by noting that various individuals and groups will object to various items on the Internet as being profane, disgusting, against the will of their favored supernatural being, or otherwise not proper for children's eyes. He sites examples of controversial-in-some-quarters materials like websites that deny the holocaust, support groups for rape victims, abortion websites that have graphic depictions of medical procedures, sites that discuss birth-control or condoms, sites that show coffins of soldiers returning from Iraq, and sites that show cartoons of the prophet Muhammad. He ends by nicely upping the sarcasm even further:

The library says it's performing due diligence by making adults who want to override Web-content blockers use privacy screens on computers that are away from children's areas. But that's not good enough. It's the government's job to make sure that no one is offended, ever. If they can't do that, we shouldn't have libraries.

So kudos for Benjamin for a nice piece.

Except... I don't like the title of it at all: "Library is no place for government". This invites the obvious question, that Mr. Wachs doesn't address: isn't this entire problem -- of free speech, and what if any limits there should be on what people can view on the Internet using library equipment -- only a problem because we have government-funded libraries in the first place? It is quite odd to title a sarcastic column that implies that the government should get out of the library business (in that it should not be regulating the viewing of legal content in the libraries), but should stay in that business as a key source of library funding. Why not really argue for "no government in libraries" by noting the root cause of the problem, and by arguing for privately-funded, non-profit-run libraries in place of government-funded libraries?

Given the massive wealth in this country, I'm quite certain towns and cities across America would still have fine (better in some ways?) libraries, given the number of rich individuals who would love to have their names attached to the library building (e.g., "The Warren Buffet Library of Fairport" or whatnot). Or consider the increase in donations from the community that each library would undoubtedly get if we had much smaller government, with individuals keeping a much larger percentage of the money they have earned. Such a world would surely have far greater feelings of generosity, benevolence, and "charity" than the current one where people see that a service (libraries, post-office, welfare for the poor, you name it!) is a government service, so figure they are already paying for such things plenty through their taxes. In such a world, issues of free speech and censorship simply wouldn't arise: the libraries would be privately funded, and if people didn't like the policies of a library, they could frequent the next library over that had different policies. A "market" for libraries would of course arise, with competition for both the quality and quantity and of the materials provided as well as the policies in place for what is included, and what can be viewed by who and when.

I don't know for sure, but I assume Mr. Wachs is not in favor of cutting all government funding of public libraries. If so, then that is the obvious reason he wouldn't raise that issue in his column. But his column's title just begs for the question to be raised!

Alert: Don't Lick Your Lunchbox 600 Times a Day for 15 Days

I remember the good ol' cafeteria days I experienced at a public elementary school in a small town in Western, NY. Lunch ladies blowing a whistle when kids acted up, or worse, making us sit "boy/girl/boy/girl" because the boys (typically) would cause trouble if allowed to sit together. Of course, a few years later we gents would have been all to happy to be allowed to sit boy/girl/boy/girl, but in 2nd or even 5th grade, that was no fun at all.

And the food... ah, the food. Tater tots, fruit salad from a can, mexican pizzas (orange grease with some bread and other stuff holding it together), and of course small ice-cream dixie-cups for a quarter (if I remember correctly).

And then there were the lunchboxes. In the 1970s and early 1980s there were some very cool lunchboxes you could have: Star Wars and comic book superheroes for the guys, and other movie stars and things of interest for the girls (can you tell I didn't pay attention to "their" lunchboxes at that age?). Or, you could brown-bag it -- something we all did as we matured into middle- and high-school.

But what we didn't have were fancy, back-pack like vinyl lunch "boxes". I must have missed when those became popular, because I surely don't remember them from my days in school three decades ago. And perhaps that is just as well -- hot news in the newspaper and even on cable news today is that these things might have unsafe levels of lead in them, that could rub off and either get on children's skin or get into the food they are carrying inside. I hadn't heard this story before, but it no doubt made the news a while ago, as Wal-Mart pulled some brands and offered refunds for some customers (oh, that evil Wal-Mart!).

So the new news is that a report of 2005 testing by government scientists might have left out important information -- key data that meant the danger from lead in these lunchboxes was being wrongly dismissed. See this AP article from the Akron-Beacon Journal, nearly identical to the one which ran in my local paper. And if you want to learn more, you can read the release from the CEH (Center for Environmental Health) which is leading the charge against the CPSC (Consumer Product Safety Commission), the government agency "charged with protecting the public from unreasonable risks of serious injury or death from more than 15,000 types of consumer products."

If the CPSC committed scientific fraud in leaving out or distorting data, then that is one thing. Not being an expert, I can't really comment on the merits of the case being made by the CEH. Their press release includes various documents, but I'm not entirely convinced of what they are claiming against the CPSC.

And one reason I'm skeptical is that this story sound so very similar to the Alar scare (see Wikipedia entry) of the 1980s, in which the original tests that led to the scare actually meant that you'd have to drink far more apple juice every day than your stomach could even handle, and do so for many years, before Alar would be a risk as a carcinogen (or similarly eat so many apples that your insides would explode well before you were in danger of cancer from the Alar). The similarity arises here because of the following:

As a result of their tests, the CPSC issued a public statement last year reassuring consumers they had nothing to worry about: "Based on the extremely low levels of lead found in our tests, in most cases, children would have to rub their lunchbox and then lick their hands more than 600 times every day, for about 15-30 days, in order for the lunchbox to present a health hazard.''

Again, I'm not an expert here, but the similarity is striking.

Oh, and gotta love the knee-jerk over-reaction of some in Congress:

Said Rep. Henry A. Waxman, D-Calif.: 'I am concerned that the CPSC has failed to protect children from an unnecessary hazard they have known about for some time. We should protect our children by banning lead in all children's products.'

Ban all lead in all children's products? Really? Does the science really back that up? I highly doubt it. And I'm not even going to mention the philosophical question about the proper role of government, and whether it should be banning things like lead at all. Well, I guess I did just mention it... OK, so I won't say anything more about it... for now.

Muslim Yankees

The January 15th issue of BusinessWeek had an interesting article titled "They're Muslims, And Yankees, Too". Nothing to do with baseball, as Yankee here just means American. The article talks about a large segment of Muslim Americans, and then spotlights four individuals in particularly, devoting a few paragraphs each to their stories. I found these tidbits about Muslim Americans interesting:

...As a group, they offer a model of assimilation and material success. An astounding 59% of Muslim adults in the U.S. have a college degree, compared with only 28% of all American adults. Surveys show that median family income among America's Muslims exceeds the national figure of $55,800. And four out of five eligible Muslims are registered to vote, slightly higher than the overall rate.

And then these two paragraphs about one of the four profiled individuals (a newspaper publisher in Michigan) are insightful I think:

Siblani, a pro-business, anti-abortion Republican who drives a sleek black Mercedes and lives in a comfortable house complete with white pillars in front, helped organize Arab American support for George W. Bush in 2000. But the President's "war on terror" after 9/11 left him feeling that his adopted country had turned against Muslims. He abandoned Bush in 2004 and publicly branded the current administration the "Taliban in Washington."

Siblani reflects the complexity of American Islam, an intricate mixture of creeds and cultures: immigrant and native-born, devout and secular, moderate and radical. By comparison, most immigrant Muslims in such countries as France, England, and Spain have remained poorer, less well educated, and more marginalized. Europeans encouraged Muslim immigration as a source of menial labor, but until recently did little to integrate workers as citizens. And more generous welfare benefits in Europe allow Muslims and other immigrants to live indefinitely on the periphery of society. The American combination of a comparatively modest social safety net with greater economic opportunity appears to have drawn Muslims willing to adjust to new customs and acquire education needed for good jobs. So the ideologically motivated violence that has erupted in Muslim enclaves in Western Europe so far hasn't surfaced from within the U.S.

Indeed.

I Want to Take Those Profits

Very often, the words politicians use are carefully chosen to obscure the essential nature of what they are advocating, and this is true across the political spectrum, and usually on both (or all) sides of any particular issue. But sometimes the specific words used -- often by mistake or in an otherwise unscripted moment -- make everything crystal clear: their true intentions, their views or private property, their views of individual rights, and so on.

Often too the wording used is so weak, that it doesn't commit them to any verifiable, accountable result that we might check on years later -- to see if the program they are pushing actually has the desired effects, not to mention does so without having any negative side-effects that they didn't intend (but that critics often predicted would occur at the outset).

Well, Hillary Clinton this past week managed to do both of these things at once: use specific wording that makes clear her views of capitalism, property, and rights, and at the same time used a string of vague delimiter-words so as to not raise expectations for the program she was proposing. Here is what she said:

The other day the oil companies reported the highest profits in the history of the world. I want to take those profits, and I want to put them in a strategic energy fund, that will begin to fund alternative smart energy alternatives and technologies that will begin to actually move us towards the direction of independence.

For the sake of argument, I won't say much about the first sentence. I heard it from many sources, so I'll just assume it is fact. I will note, of course, her use of the name "oil companies" -- a vague reference to distant big business entities, with the attending leftist negative connotations that come with it. And more importantly, like all on the left, she loves to quote the raw profits -- noting that they are a record -- not mentioning that the profit margins for this industry are not anywhere near record levels compared to other industries.

But then there it is: "I want to take those profits...". This is as direct as it gets. A politician boldly saying that they want to use force to take the property of some individuals -- including the stockholders of private oil companies, many of whom are people like you and me. This is of course most commonly done through taxation, which by definition is the use of force to fund government programs, both legitimate government services and everything else it does. But just saying "taxes" is the easy way out for politicians, because most people don't think too much about taxes: they are inevitable, along with death as the saying goes. But she didn't literally say, this time, "I want to tax the profits" -- or even worse, as she and others on the left usually say, "I want to tax the windfall profits" or "I want to tax the excess profits" -- whatever those would even mean in an industry that, again, isn't enjoying record marginal profits as compared with other industries (and even if it was, it would be arbitrary to draw a line and declare anything above it "excess" profit). No, this time she said "I want to take those profits...". Of course, she wouldn't dare take all the profits earned by these companies and their stockholders, we know she is talking about just an industry-specific tax -- but it is instructive to hear her say it as she did.

Is this not revealing of her views of rights, property, and capitalism? What is to stop such a mentality from saying the exact same thing in the future, but about any industry or specific company that she chooses to target? Consider "I want to take the profits of Microsoft, and use them to strategically fund bridging the digital divide." Or "I want to take the profits of Pfizer and Merck, and use them to fund free medicines for everyone." Or "I want to take the profits of LucasFilms and Disney, and use them to fund PBS since people don't seem to be willing to pay for it themselves." Why not?

But that one brief series of statements was rich with political goodness. Read the rest of what she said again, the part where she describes what she will do with the property she is going to take by force from the stockholders of these companies: "I want to put them in a strategic energy fund, that will begin to fund alternative smart energy alternatives and technologies that will begin to actually move us towards the direction of independence."

Wow... see all the words in italics -- lots of great politician-speak terms in that one.

To be fair, I (and many people) share the desire to have fuel alternatives that diversify our energy supply so as to free us from reliance on unstable countries run by criminals -- i.e., any leaders who routinely, and on principle, violate the individual rights of their citizens.

But does this desire permit the use of force to take property from some individuals in order to do things that aren't the proper role of government (invent things, create energy, etc.)? Of course not. And she isn't even saying that the government's taking and use of these citizens' property would necessarily produce a measureable result: rather, it would be "strategic", in that it would begin to fund things that would begin to move us towards a direction. And of course it would do these beginnings and movements with all the efficiency that government programs always give us. I can't wait to see the results... it sure sounds exciting!

Having said all of this, I will note that I am in favor of eliminating any subsidies that the "oil companies" get. So don't call me "pro big-business" or "pro oil companies" (I am pro-capitalism.) But this is because I am in favor of eliminating all subsidies that all private companies get. They should all be removed at once, so that no companies -- i.e., no individuals who own, work at, or invest in those companies -- are given unfair advantage over the rest of the marketplace, and by means of the use of force to take property (money) from everyone else who is not so favored by bureaucrats.

It is important to properly distinguish between subsidies, taxation, and tax-breaks. In brief, taxation is the government taking, by force, money or other property from individuals (or companies). Subsidies run in the other direction: they are the giving out of the money collected through taxation to particular individuals or companies. A tax-break is a targeted reduction in taxes, for an individual or company, that would otherwise be taken from them. I feel the need to clarify these three terms because often politicians make it sound as though the elimination of a subsidy or a tax-break, simply because it is changing that status quo, is the same thing as a new or increased tax. Or vice-versa -- that somehow lowering or eliminating a tax is some sort of subsidy for that individual or company. We must always be on the watch for such muddled, erroroneous thinking and deceptive statements from politicians!

So if "oil companies" are getting special subsidies (handouts), then that should stop -- just as it should for all companies. I am also in favor of eliminating tax-breaks for oil-companies -- but again, only because I think there should not be any tax-breaks at all. Tax-breaks are inherently unfair, simply because they don't apply to all individuals (or companies). They are a form of social engineering, and are riddled with bureaucratic inefficiencies, favoritism for some individuals over others, and so on. Indeed, the entire edifice of pork-barrel spending, lobbyists run-amok, and so on that makes the headlines year after year -- all of that would just vanish if the government only funded through the force of taxation (if need be) its legitimate functions (i.e., those that are needed for the protection of individual rights).

Updated PPA Website

The Poker Players Alliance (PPA) website has been recently given a facelift... looks pretty good. I particularly like the nice and succinct "Important Facts Congress Should Hear" section in Yellow in the middle of the homepage. Here is a nice, very short intro item too. There is lots of good info on this site... so if you are interesting in protecting the great game of Poker, and online poker in particular, check it out and become a member!

Mercury in Fish Another Overblown Issue

Today I read two somewhat contradictory stories in my local paper about mercury levels in fish, and to what extent this is a health hazard for us. The first (originally from Washington Post, but see it here) describes a recent report that suggests some areas are more susceptible to mercury pollution than others, describing these areas as mercury "hot spots". As a report about a report, it seemed like a fine article I suppose. But what it lacked was any mention of why we should care much about the issue. It just took it for granted that everyone knows that mercury-in-our-fish is a bad thing. And that is probably making a safe assumption on the part of readers, since we have been bombarded with stories of how dangerous mercury found in our fish diets can be for our health.

But the story gets very much complicated by the second, shorter article I read today. In the USA Weekend supplement to my local paper, the "Eat Smart" column by Jean Carper was titled "Phony Fish Scare?". Here it is in full:

Don't let a mercury scare keep you from eating fish, says William Lands, Ph.D., formerly with the National Institutes of Health and a leading expert on the benefits of fish oil. He says virtually all fish, even those high in mercury, are safe.

"Mercury is toxic in the absence of selenium," Lands says, "but fish is loaded with selenium that neutralizes the danger." A new University of North Dakota study shows that common fish, including grouper, swordfish, tuna and salmon, have much more selenium than mercury. Even albacore tuna (high on the government's hit list) has 15 times more selenium than mercury, making it perfectly safe, in Lands' view.

Is there any fish Lands would avoid because of high mercury? No, except maybe the pilot whale, not seen in U.S. markets.

So that was eye-opening for me. Selenium, which is common in fish, counter-acts the dangers from mercury.

So I did a little looking around the web, and I found several interesting things. The first was this article, which has an interesting excerpt including a graph showing the relative levels of mercury and selenium in various types of fish, and also in pilot whale -- the mammal mention by Lands above. Very interestingly, there are far greater levels of selenium than mercury in all the fish species shown: sole, flounder, salmon, tuna, pollock, halibut, cod, snapper, grouper, and swordfish. But in the case of pilot whale, the relative amount of selenium is much lower than in all the types of fish listed.

The info in the article was taken from materials at mercuryfacts.com, which seems to be the same site as fishscam.com. This site has lots of interesting materials, including critical comments about prominent scientists and environmentalists who are promoting fear of mercury in fish. As just one item on their site, see "The Flip Side of Mercury". One also discovers that much of the health concern over mercury in fish comes from a study that involved... guess what... pilot whale. See also the Mercury Myths page, which details problems with the following common claims:

• The amount of mercury in our environment (and in the fish we eat) is dangerously increasing.
• Mercury in fish presents a serious health risk to Americans.
• The health risk from mercury outweighs the health benefits of eating fish.
• You can get mercury poisoning from the amount of fish you might consume in a given week or month.
• Every year in the United States, 630,000 children are born with mercury levels in their blood that put them "at risk" for neurological disorders later in life.
• Eight percent of American women of childbearing age have unsafe levels of mercury in their blood.

Apparently there is good reason to doubt each of these claims.

Pacifism, Self-Hatred, and Complacency

Daniel Pipes' Dec. 26th column, How the West Could Lose, offers an analysis of how the West could lose its battle with Islamism (defined as persons who demand to live by the sacred law of Islam, the Sharia), because of the triple affliction of pacifism, self-hatred, and complacency. An interesting read and also includes several bullet points that nicely summarize the formidable capabilities of the Islamists.

Privatizing and Protecting Marriage

A few months ago the newsletter of the Independent Institute (simple called "The Independent") had an interesting blurb called "Privatizing and Protecting Marriage". Here it is in full:

The institution of marriage could better meet needs if couples had more options than taking or leaving the terms of marriage offered in the one-size-fits-all version provided currently by government, according to Doshisha University Law professor Colin Jones (“A Marriage Proposal: Privatize It”).

“Couples entering into marriage should be able to use a partnership agreement that is tailored to their own circumstances and aspirations, one that reflects the values and expectations that they themselves attach to marriage,” Jones writes. (An op-ed based on his article ran in the San Francisco Chronicle, January 22.)

Ending the government’s monopoly on marriage, Jones argues, would foster innovation in the design of marriage contracts, resulting in better legal and relationship counseling, better protection for children and spouses, and better marriages. Couples could select from a variety of marriage-document kits. They would also be free to form or join marital corporations— organizations, including churches, whose members share the same values about marriage—which might arise to cater to the needs of different kinds of couples.

This privatization of marriage, Jones further suggests, might also help defuse the controversy over same-sex marriage because opponents and proponents of same sex marriage would join separate marital corporations and thus would see their version of marriage protected. See “A Marriage Proposal: Privatize It”.

This is in line with my own views on the matter, which has come up for me whenever I've heard in the news all the controversy over "protecting marriage", the attempted constitutional ammendment, and so on. The one new thing here that I hadn't thought of is the idea of "marital corporations" as described above... an interesting idea.

I'm sure many religious conservatives would passionately disagree with most or all of the above. But I have yet to hear a good, rational argument from them on these matters. The one most commonly tossed out is that by allowing homosexuals to marry -- which they usually think would be wrong in and of itself -- you are starting us down the slippery slope to all kinds of insanity, a list they then immediately rattle off that usually includes at least polygamy, child abuse, and some kind of beastiality (a guy marrying a goat, or a woman marrying a frog that she thinks will turn into a prince or whatever).

Well, this is an obvious straw man argument against allowing homosexuals to marry. First, it doesn't deal directly with the rights issue for homosexuals at all. But second, the slippery slope makes no sense. Marrying a child or marry an animal would not be allowed, because children do are not eligible to have the full rights of adults that come from having full ethical personhood status -- and this is based on the rational faculty reaching a certain maturity level. On this basis, obviously animals would not be candidates to be wed to humans either. (I'll note that if intelligent, rational aliens were ever discovered on other planets, this criterion would permit a human adult to marry them, and that makes complete sense... why not?).

The point is that if two persons (as just briefly described) wish to marry, wish to commit to each other, and wish to have a particular joint legal and economic status as such in the eyes of the society in which they live... why shouldn't they be allowed to? Most today would agree that people should be "allowed" to marry other people from any economic class, race, ethnic group, and so on. It wasn't too long ago that this was not the case, but fortunately, most societies have gotten at least this far. But why not two homosexuals? And why not multiple men with one woman, or multiple women with one man (polygamy)? I see no rational reasons to disallow these -- that is, arguments based on the individual rights of persons (not on utilitarian grounds, and not to mention faith-based supernatural and mystical "arguments"). If you can think of any such arguments against homosexual marriage and polygamy -- that are based on the individual rights of adult persons -- I'd be interested to hear them.

Having said that, I'll note that I don't believe that married couples should be given tax benefits. This is a form of social engineering by the government. The point of marriage is mostly a private matter between the people getting married -- and a sign of commitment in the eyes of the society in which they live. It could (and perhaps should) also serve as a proxy for things like implicit permission for hospital visitation rights, default inheritance in the event of death, and so on. But marriage should not be a means to get tax benefits or other special treatment from the government (positive or negative).

Tragically Meek Pretense at War

Elan Journo voices a view of the Iraq and broader Middle East situation that is rarely heard. The title of my blog post comes from this section of Journo's article:

We triumphed over both Japan and Germany in less than four years after Pearl Harbor. Yet more than five years after 9/11, against a far weaker enemy, our soldiers still die daily in Iraq. Why? Because this war is neither assertive nor ruthless—it is a tragically meek pretense at war.

Consider what Washington has done. The Islamist regime in Iran remains untouched, fomenting terrorism. (And now our leaders hope to "engage" Iran diplomatically.)

We went to battle not with theocratic Iran, but with the secular dictatorship of Iraq. And the campaign there was not aimed at crushing whatever threat Hussein's regime posed to us. "Shock and awe" bombing never materialized. Our brave and capable forces were hamstrung: ordered not to bomb key targets such as power plants and to avoid firing into mosques (where insurgents hide) lest we offend Muslim sensibilities. Instead, we sent our troops to lift Iraq out of poverty, open new schools, fix up hospitals, feed the hungry, unclog sewers—a Peace Corps, not an army corps, mission.

It is true that the "war on terror" is being waged as something different than traditional wars. But the reasons most give for amount to a dangerous mistake. Consider:

Those who say this is a "new kind of conflict" against a "faceless enemy" are wrong. The enemy Washington evasively calls "terrorism" is actually an ideologically inspired political movement: Islamic totalitarianism. It seeks to subjugate the West under a totalitarian Islamic regime by means of terrorism, negotiation, war—anything that will win its jihad. The movement's inspiration, its first triumph, its standard-bearer, is the theocracy of Iran. Iran's regime has, for decades, used terrorist proxies to attack America. It openly seeks nuclear weapons and zealously sponsors and harbors jihadists. Without Iran's support, legions of holy warriors would be untrained, unarmed, unmotivated, impotent.

Destroying Islamic totalitarianism requires a punishing military onslaught to end its primary state representative and demoralize its supporters. We need to deploy all necessary force to destroy Iran's ability to fight, while minimizing our own casualties. We need a campaign that ruthlessly inflicts the pain of war so intensely that the jihadists renounce their cause as hopeless and fear to take up arms against us. This is how America and its Allies defeated both Nazi Germany and Imperialist Japan.

One crucial mistake the US continues to make in its "war on terror" is to not aggressively target those individuals -- the government and religious leaders -- who actually sponsor and foment terrorism. We have tried to go after Osama Bin Laden and that is good to do. But whenever Iran and Syria are mentioned, inevitably it is said that "military options are not on the table". And in Iraq, while we have successfully gone after some terrorists and their supporters, what about Moktadr al-Sadr?

Another crucial mistake that the US continues to make is to push primarily for "democracy". While Bush speaks of "liberty" and "freedom" almost ad nauseam, he really doesn't understand what those concepts are and what they require and presuppose on the ground. This comes out everytime he, or a member of his adminstration, says they are in favor of spreading "democracy" and a "constitution" for Afghanistan, Iraq, etc., but that they don't have to be patterned on the USA version of a consitutional republic that protects individual rights. That is, they don't need to be modelled on western values, they don't need to be even remotely capitalist, or strongly respectful of women's rights, minority rights, religious rights, and so on. Such a "democracy-is-what-matters" viewpoint is doomed to failure. As Journo notes:

When asked whether he would accept just such an outcome from the elections, Bush said that of course he would, because "democracy is democracy."

And that is exactly the problem. Democracy is not the end-game that leads to peace. Constitutionally governed republics, that respect individual rights, and are at least moderately laissez-faire capitalist, are what produce peaceful, prosperous societies. Democracy is just one small aspect of that -- necessary, to be sure, but far, far from sufficient.

On American Giving

A very interesting column by John Stossel on American charitable giving and foreign aid. He first notes the well-reported facts that America gives less than many other Western countries in foreign aid as a percentage of GDP. However, he then correctly notes that this is equating "American giving" with only government giving -- i.e., only the giving that is forced giving. It doesn't include the much larger voluntary giving done by individuals. When you factor in charitable giving from the private sector, you get a very different picture.

For example, he notes that "After the Asian Tsunami two years ago, the U.S. government pledged $900 million to tsunami relief. American individuals donated $2 billion -- three times what government gave -- in food, clothing, and cash. Private charities could barely keep up with the donations."

Aside from the fact that I don't understand the "three times" remark (isn't it barely over two times based on the numbers he cites?), the important fact is clear: Americans as individuals give a lot to charity. And that charity helps the poor and in this country and the poor around the world.

Stossel gives a few examples to argue that voluntary, charitable giving is usually more effective too. This is important. Because presumably if you want to help the poor you want to actually help them, not just spend money with the intention of helping them. So to compare apples with apples, and do so on the relevant dimension, we should try to quantify the actual improvement in the lives of the poor as a result of charity and foreign aid. Money spent that is squandered by corrupt governments or money given that is absorbed through "administrative costs" of a charity or bureaucracy should be discounted relative to the money that is given and is less wasteful -- that is, that does more to actually help the recipient.

Consider this other interesting tidbit from the Stossel column: "Syracuse University professor Arthur Brooks's new book, Who Really Cares, points out that Americans give more than the citizens of any other country. Individually, Americans give seven times more money than people in Germany and 14 times more than Italians give. We also volunteer more."

Wow... impressive numbers indeed. So keep those numbers and issues in mind the next time someone bemoans the relatively low foreign aid from the USA as a percentage of GDP. Ask them what the total giving by American individuals is, including both their forced giving and their voluntary giving. And then ask them to please provide the data not in terms of total money given, but to factor in the amounts wasted by administrative or bureaucratic costs, or that is lost through corrupt governments int he receiving country, thereby arriving at comparisons of the actual good that is done for the intended recipients of the charity/aid.

Map of Botched Paramilitary Police Raids

I don't think I've blogged about this before, even though I first saw this resource a while back. Here is a very informative -- and scary -- map of botched paramilitary police raids. So many innocent people injured or killed as a result of these incidents!

So many of these botched raids are the result of America's insane "Drug War". Sadly, changing course in that "war" seems to be getting very little attention these days.

Kudos to Cato and Radley Balko for putting this information together.

On Waterboarding

If you are like me, you've heard a lot about "Waterboarding" as a means used by interrogators to get information from those captured. It is usually described as invoking a feeling that one is drowning, without actually causing any real, lasting harm.

So I was glad to get a chance to see reporter Steve Harrigan voluntarily undergo waterboarding to demonstrate just exactly what is involved.

Assuming that this was an accurate portrayal of waterboarding and its "phases", I think it is essential to note that Harrigan admits that although it was not at all pleasant, he felt fine again a matter of minutes later. This technique uses fear and pain to try to get information, not permanent mental or physical harm (e.g., cutting off a finger). For me, this distinction is important in considering whether waterboarding should be called "torture" or not, and hence whether it should be allowed or not to get vital information from high-value prisoners.

Handful of Iraq Suggestions

The always-a-good-read Daniel Pipes provides several interesting proposals in his recent posting In Iraq, Stay the Course - But Change It.

TSA Little Dictators

Greg Perkins at NoodleFood provides an amazing and funny tale of his recent attempt to get through airport security.

What Is and What Should Never Be

I have recently written (here and here) about the United Nations and why I think it is not just problematic at present, but flawed at its core, and that the US should immediately announce our intention to leave the world body by a set date (say, six months from now). But of course, my primary criticism of the UN -- that it sanctions countries 'led' by criminals (dictators and other statists who deny, on principle and by their very existence, individual rights on a massive scale) -- also applies to some actions and policies of the US (and other countries) in our direct dealings with such criminal leaders.

The latest example I've seen is reported in the Sept. 25 issue of US News and World Report, in the article "Dictator and Diplomat". It shows a grotesque picture of Sec. of State Rice shaking hands with Equatorial Guinea (see Wikipedia entry on EG) "President" Teodoro Obiang Nguema. The sub-headline reads: "Why is this man smiling? Here's a hint: It has something to do with oil."

So of course this is just another example of the US playing friendly with oppressive regimes because of our interest in the oil they have. Such supposed "pragmatism" is standard practice for the US, for many, many decades, especially it seems in dealings with third-world countries.

I won't make the same arguments here that have been made many times before... that the US shouldn't deal with such regimes, even given their value as oil providers (including the more difficult cases -- due to the size of the oil reserves in question -- such as Saudi Arabia). I only mention this case because again, if the US were to make a radical break from its past policies, and announce a completely new set of policies -- and hence its plans to leave the flawed United Nations -- I can't help but wonder what kind of changes such an earthquake would cause in the various dictatorships of the world. It would vary from country to country, but I wonder if the US did this, and if a few other major countries came along with us in doing so (say Britain, Australia, et al.) -- would some of the smaller thug states not look at the new reality and decide to radically reform? It is not at all easy to predict, and I'm sure most people would think I'm being naive and entirely too optimistic, but I wonder about this. I doubt Saudi Arabia or various other large countries would change their ways very quickly, but a puny country like Equatorial Guinea?

Afterall, the US is currently the only military and economic super-power in the world. Couldn't we use that position to change the world for the better by setting a new path, much as our founders did when they created the country? This would be for both our own benefit and for the benefit of all those whose individual rights are being violated on such a massive scale.

Walter Williams on Foreign Trade

Walter Williams makes many good points about foreign trade and the US trade deficit, and along the way rightly criticizes protectionists like Pat Buchanan. And I really liked the end of this column:

Buchanan, like so many others, points to the government subsidies and tariff protections given to businesses in other countries, a practice from which we can’t plead complete innocence. Protectionists call for “free trade but fair trade.” They call for a “level playing field.”

In effect, they’re saying that if other governments rip off their citizens with business subsidies and import duties, forcing them to pay higher prices, our government should retaliate by using the same tools to rip off its citizens.

The next time I see Pat, I might ask him what he would do if we both were at sea in a rowboat and I shot a hole in my end of the boat. Would he retaliate by shooting a hole in his end?