Purity Part II

I wrote my last post on Friday. On Saturday Dede Scozzafava, the officially endorse Republican, bowed out of the race out of party unity. On Sunday she started campaigning for the Democrat. What to make of this?

First, Scozzafa is a sore loser with no honor. She took large sums of cash to run as a Republican. At the very least, she should have gone out quietly. Her actions on behalf of the Democrat show that she was never committed to the Republican party.

Second, this calls into question the judgment of the party members who supported her. Why support someone who has no party loyalty and whose views are not in line with the party? This minor race may eventually doom Newt Gingrich's presidential ambitions.

The third point is the question of who is welcome in the Republican Party? Several Democrats and their supporters have already insisted that this means that centrists and moderates are not welcome in the GOP. I have two answers to this. The first is that, in its rush to appeal to centrists, the Republicans have been alienating the conservatives. Which is more important to the party? Moderates or conservatives? The Tea Party movement shows that there are a lot of angry conservatives who the Republicans are either ignoring or taking for granted.

If this election means that moderates are not welcome in the Republican party, how welcome are they in the Democratic Party? Joe Lieberman is an interesting case study.

In 2000 he was the number two man on their ticket. He ran for president himself in 2004 although he tends to suck excitement out of a room. His voting record shows that he aligns with the Democrats more than 90% of the time. The exception was the Iraq war. This is where it gets interesting.

Because of his support for the war, Lieberman was run out of the party. A challenger defeated him in the 2006 primary. I saw liberals openly celebrate this. Several posts on Huffington claimed that this was the biggest victory for Democracy in America since 1776 (I'm not exaggerating). Someone forgot to tell the voters. They reelected Lieberan as an independent. Because of his treatment, he campaigned for McCain in 2008.

The Democrats still need him so he is allowed to caucus with them and he kept his committee assignments and seniority.

Last week he announced, as other centrist Democrats have done, that he cannot support a health care bill with a public option. Once again there were calls to have him expelled from the Democratic caucus and stripped of his committees. No centrist dissent is allowed here. So much for the Democrats appealing to the middle.

Purity or Pragmatism?

New York's 23rd District is an interesting case. Right now there is a special election going on there. The district gave Obama a slight edge in 2008 so the Republicans decided that they needed to run someone who would appeal to swing voters and Democrats. They chose Dede Scozzafava who has a liberal voting record. Regardless, the party went along with this and endorsed her.

There was one notable exception - Sarah Palin weighed in, endorsing Doug Hoffman who she considered a more reliable conservative. Initially both parties reacted with disdain - 'There goes Palin again.' A funny thing happened since then - Hoffman is currently ahead of the Democrat by a slight margin and way ahead of Scozzafava. The race could still go to the Democrat but if it does the Republicans will have only themselves to blame (and I'm excluding Sarah Palin from this).

There is an important lesson here but I'm not sure that the Republicans echelon will heed it - conservatives can win, even in districts that went for Obama. For the past year conventional wisdom has held that the voters have turned against conservatives and that the Republicans' road back to power lies in recruiting moderates. At the same time there is a conservative movement that longs to see the Republicans run actual conservatives. This movement has embraced Sarah Palin and is scornful of the Republican leadership.

Recent polls show that the Republican strategy needs rethinking. People who self-identify as Republicans is down around 20% but people who identify themselves as conservatives is over 40%. This is nothing new. Conservatives have outnumbered Republicans for decades but the size of the split shows how dissatisfied conservatives are with Republicans. (Interestingly, the same polls show that there are usually more Democrats than liberals.)

The number of conservatives was at a low point in 2008 and has increased greatly as people see what a liberal (or progressive) government is actually like.

It is hard to predict how a three-way race would go if it was only a two-way race. It is possible that Scozzafava and the Democrat are splitting the liberal and moderate vote allowing a minority of conservatives to determine the election. It is also possible that a district that only gave Obama a slight edge in 2008 has turned against the chosen one and would elect any one who does not have a "-D" after his name.

In the meantime, the Republicans are in the strange position of opposing a front-runner who would act as a Republican in Congress.

On the other side, high-ranking Democrat Van Hollen made an interesting analysis.

By rejecting that candidate for a non-Republican ... and picking somebody else, I think they send a signal that they're more interested in purist ideology than they are in problem solving,

I will not argue with that but I do wonder where Van Hollen stood when the Democrats tried to eject Joe Lieberman from the party in 2006 over ideological differences?

Warming or Cooling?

A recent poll showed that the number of Americans who believe in global warming in general and man-made warming in particular has fallen quite a bit. Several skeptics have pointed out that warming seems to have stopped around a decade ago.

In their role as climate advocate, the AP commissioned some statisticians to review the climate record and see if the climate is warming or cooling. Their opinion, at least as reported by the AP, is that the world continues to warm. At first glance this looks like a case closed. Global warming is real and is continuing. There are some red flags in the story.

The biggest red flag is the data set presented to the statisticians. There are three possible sets, two based on satellite measurements and one based on ground-sensors. The satellite-based sets show less warming than the ground-based ones. The article mentions the satellite-based figures but minimizes them but it is not obvious that it is doing so. For example the paragraph:

U.S. government data show the decade that ends in December will be the warmest in 130 years of record-keeping, and 2005 was the hottest year recorded.

Seems straightforward. You have to already know that this data comes from the ground-based sensors and is maintained by a department headed by a global warming activist. That puts the data in a different light.

Once you get around half-way through the article you finally get a single skeptic quoted (note that he is identified as a skeptic, no one else's affiliation is identified).

One prominent skeptic said that to find the cooling trend, the 30 years of satellite temperatures must be used. The satellite data tends to be cooler than the ground data. Key to that is making sure that 1998 is part of the trend, he added.

What happened within the past 10 years or so is what counts, not the overall average, contends Don Easterbrook, a Western Washington University geology professor and global warming skeptic.

"I don't argue with you that the 10-year average for the past 10 years is higher than the previous 10 years," said Easterbrook, who has self-published some of his research. "We started the cooling trend after 1998. You're going to get a different line depending on which year you choose.

"Should not the actual temperature be higher now than it was in 1998?" Easterbrook asked. "We can play the numbers games."

But Easterbrook is not given the final word. The next paragraph refutes him.

After that all pretense at fairness is abandoned. There is a quote from the Union of Concerned Scientists which is a lobbying group, not a scientific one. An economist and a couple of climate scientists are quoted without being identified as global warming believers. President Obama is quoted. Figures from NOAA are quoted without mentioning that they are are from the ground-based sensors and do not agree with the satellite-based figures. It has this observation

Of the 10 hottest years recorded by NOAA, eight have occurred since 2000, and after this year it will be nine because this year is on track to be the sixth-warmest on record.

This is meaningless. Even if the world is cooling, it would be cooling from the 1998 high point.

It closes with the prediction that 2010 will be the warmest year on record, not because of global warming but because of an El Nino. Even with the qualification, this was only tossed in to confuse the issue. Temporary warming caused by El Nino has nothing to do with global warming.

Watts Up With That looks at the article and concludes that you can prove anything with statistics.

First Define Reform

News reports from the weekend paint a picture of a Congress (at least the Democrats in Congress) that is sure that they need to pass something called health care reform but cannot answer basic questions about what it will include. This is ridiculous. We are talking about mandating major changes to a significant portion of the economy but we haven't decided what should be reformed.

Should there be an employer mandate? The House isn't sure. Will there be a public option? We probably will not know until something is presented to the President for signing.

Regardless, there is still a sense of urgency that Congress has to get something passed this year. It doesn't matter what. All that matters is getting something through so that they can claim victory.

There is a solid reason for the urgency - fear. Many Democrats are sure that they suffered major losses in the 1994 election because they hadn't passed health care reform. This is rather silly since the voters turned to the party that opposed health care reform. More likely the switch had more to do with disillusionment with the Clinton administration in general and with specific policies like his attack on guns in specific (it is generally acknowledged that Gore lost the 2000 election because his home state of Tennessee was still upset about his role in passing gun control legislation). None of this matters to Democrats. Looking back, they see the 1992 election as having been a mandate to pass health care reform and their 1994 losses as their just punishment for failing.

Conventional wisdom is that Congress does not like to pass controversial legislation on an election year. It gives their opponent something to run on. According to this school of thought, Congress will not pass a health care will in 2010 so it must pass it now or wait until 2011. The hope is that is they pass it now, then voters will have forgiven and forgotten it by the 2010 election. Or they will be sick of hearing about the subject.

This is a strange bit of reasoning. Congress wants to pass major legislation but they are afraid of voter backlash.

There is another reason that Congress is worried about passing a health care bill. They need every vote that they have. There is a very real chance that they will not have enough votes in 2011.

But that is not an excuse for what they are doing now. It is impossible to claim a mandate if you can't clearly state the major provisions of the legislation you are trying to pass.

Coming elections

There are three possible reasons for the Democrats' dominance in the last two elections. It is important to identify which is correct because future elections will hinge on an accurate assessment. I've gone over these before but it is worth a new look.

The country moved to the left.
This is the Democrats' favorite explanation - that the voters are demanding a more progressive government. If true then it means that the Republicans must either follow the Democrats to the left in search of moderate voters or doom itself to permanent minority party status. Either way, the Democrats win since they will be able to advance their agenda.

If this is true then the Republicans have to abandon Reaganomics and embrace Obamanomics. They need to recruit centrist candidates who will work with Obama.

The country was sick of Bush and corrupt Republicans.
Starting with Hurricane Katrina, Bush's approval rating started dropping and never really recovered. At the same time, several Republicans were implicated in sex and money scandals. The voters turned the scoundrels out, not caring much about who repalced them. This is the Republicans' favorite explanation since it means that the voters will soon tire of the Democrats and start electing Republicans again. There is some historic justification for this since the opposition party usually makes gains during mid-term elections. The mid-term election in the sitting president's second term is usually brutal to his party and this is when the Democrats started winning. A bad economy also hurts the party in charge.

If this is true then the Republicans just need to run strong candidates and wait for the voters to return to them.

The Republicans lost their way.
There is currently a split between conservatives and Republicans. The GOP is interested in running anyone who looks like a strong candidate. The conservatives want ideological purity. They say that part of the reason that voters rejected Bush and the Republicans in 2006 and 2008 is that they didn't stand for anything. The corruption and scandals were part of the problem. This group says that the Republicans need to clearly define themselves as being different that the Democrats instead of a slightly more moderate version. Their battle cry is "A choice, not an echo." The Tea Party protests are a manifestation of this as is the debate about Glenn Beck being good or bad for the Republicans.

If this is true then the Republicans still have a lot of work to do. They can't simply wait for the voters to return to them. They will have to earn the voter's trust. This is the hardest of the three but the rewards are greater. The Democrats took the second path, running moderates and waiting for the voters to come to them. The result is that they have a majority in Congress but not the ideological purity to enact sweeping changes.

The truth is probably somewhere between the second and third points. There is little evidence that the country made a major, permanent shift to the left. Democrats in 2006 and 2008 included conservative principles such as a balanced budget in their platforms. The 2008 election was mainly about the economy and the Iraq war. Universal Health Care was a side-issue and what is being proposed today is quite different from what Obama proposed a year ago.

That said, the nation still does not trust the Republicans. There is a vacuum of power at the top with no articulate leaders. This gives talk radio hosts and columnists more influence than they should have. Republicans hope to profit from the Tea Party movement but, after a multi-year spending binge under Bush, it is hard for them to portray themselves as champions of fiscal restraint.

At the same time, Obama may turn into a drag on the ticket. In the Virginia governor's race, Bob McDonnell, the Republican is comfortably ahead. Creigh Deeds, the Democrat, is blaming Obama and the Congressional Democrats. The White House is trying to counter this impression and is blaming Deeds for being a bad candidate. Now that the Democrats control Congress, they are the ones being implicated in scandals.

The voters are disillusioned with Obama and the Democrats but the Republicans need to offer more than a return to the Bush years to close the deal.

What's a news operation?

Last week and over the weekend the White House announced that it did not consider Fox News to be a real news operation but instead the research arm of the Republican Party. They urged everyone else to stop treating Fox as a news operation. What does this mean?

Since the days of LBJ, every administration eventually decides that the press is out to get it and goes into bunker mode where it treats the press as hostile. The Obama administration adopted this attitude about portions of the press and the media in general almost before the inaugural balls had ended. Only a couple of weeks into his administration, President Obama admonished House Republicans to stop listening to Rush Limbaugh. The Obama made other statements indicating that they considered Rush to be the head of the Republican Party.

Others have been trashed along the way, either by the President personally or by White House staffers. The current target is Glenn Beck. When asked for examples of Fox bias, the White House mentioned the 5 pm time slot - Glenn Beck.

It is understandable that the Obama administration doesn't like Beck. He has been digging up dirt on Obama appointees, especially the czars who don't have to go through a confirmation process. The White House wants to marginalize Beck. Currently the dirt he digs up gets picked up by Fox News and conservative columnists. The idea is to quarantine Beck and Fox. When they ask other news operations to stop treating Fox as one of them, they mean that they want the rest of the media to stop picking up stories generated by Beck. This is nothing more than an administration asking the media to censor itself of stories that are damaging to the President.

The White House charge that Fox is biased is laughable. All of the news operations are biased. Five years ago CBS allowed a producer to cap a multi-year crusade against President Bush with a story that depended on Xeroxed documents that an informant said were passed to him by an unknown woman at a rodeo. CNN felt the need to fact check an SNL sketch that made President Obama look bad. Keith Olbermann has been giving angry editorials under the heading of "special reports" for years. Also, he tends to name conservatives as the Worst Person in the World so often that it has become a badge of honor. But, according to the White House, only Fox is biased.

This is another way of favoring friendly news organizations over hostile ones which is an old political tradition. The difference this time is that the Obama administration is trying to appear clean when their real purpose is to bury damaging stories.

Something that Obama and his administration yet has to learn is that it is difficult to muzzle the press. Efforts to do so simply spotlight whatever they are trying to cover up. Fox's ratings are way up. MSNBC's are down.

Various Political Gripes

Nobel Peace Prize Winner Obama desires to meet with the heads of hostile nations without precondition but he will not appear on Fox. He travels a lot but he spends most of his time in blue states.

Obama's defenders point out that only a fraction of the massive stimulous bill has been spent to date. So why are the Democrats talking about a new stimulous?

Leftist economists such as Paul Krugman insist that deficits don't matter. We need more governent spending. When it is pointed out that government stimulous ever ended a recession before they insist that governments just didn't spend enough. That thinking is catching up with us. The world is moving away from the dollar standard. This will probalby be a bad thing for the entire world but it is inevitable. With Obama's massive spending, no one trusts the dollar any longer. Krugman assures us that this doesnt matter, either. We will see.

The bill that passed the Senate finance committee is supposed to be deficit-neutral. They did a lot of slight of hand to achive that. In order to pay for it the bill has several new taxes and cuts. Those will go into effect immediately. The money to help people buy insurance will not start for another three years. That means that the CBO weighed ten years of taxes and cuts against seven years of spending. Even at that, it came out around even. That means that long-term costs for health care will go into the deficit.

Even with sky-high taxes, the bill will not provide universal coverage. Something like 17 million people will still not have insurance. The last figure that Obama gave for the uninsured was 30 million so the bill will not even cut tat figure in half.

Nancy Pelosi vowed to get revenge on the insurance lobby after they lauched anti-reform ads. She is planning to push a public option in order to hurt them. I can't think of a worse reason.

One reason that so many progressives want a public option is that they regard insurance company profits as immoral. Keep in mind that insurance companies do not provide care. They pool risk and pay for individual's care from that pool. If it is immoral to make a profit on that then what else is immoral? Or is the list sorter is I ask where it is moral to make a profit.

The Peace Prize II

It's been a few days since the Nobel Peace Prize was announced but no one has advanced a good reason for why is went to President Obama. Lets face it, there is no good reason. There are two likely possibilities:

1) The Nobel committee for got that Bush left office because of term limits and gave Obama the prize for replacing him. This is a variation of the theory that he was given the award by not being Bush. There is something to this. The Prize committee hated Bush enough that they gave two or three previous awards as a slap at Bush.

2) They wanted to be part of the Obama experience. Back in 2008 the Obama campaign felt like a movement to the participants. People fainted regularly just from hearing him speak. The wife of a friend of mine forbid him from leaving the house the night of Obama's acceptance speech. She wanted him to hear history live.

This enthusiasm was also present overseas but without any outlet. Citizens of Finland couldn't vote in the US election.

When Obama was nominated, this gave the award committee an opening. They could become part of the Obama experience by giving him the Peace Prize. It hardly mattered that he was not qualified. He won the election with little qualification and the Presidency has real power.

Under normal circumstances, giving the Peace Prize to a newly-elected president seems ridiculous but, given these two factors, Obama seems like a slam dunk.

Columbus Day

Early in the 19th century, several New York intellectuals including Washington Irving decided that, as a new nation, America needed new heroes. They chose George Washington, Ben Franklin, and Christopher Columbus. Washington even wrote a biography of Columbus, although he made up make details rather than doing research.

Does that mean that we shoudn't celebrate Columbus Day? No. The reasons that they chose Columbus are as valid today as 200 years ago.

To simplify, without Columbus's voyage, we would not be here today. It doesn't matter what sort of a person Columbus is. We are not celebrating his birthday. We are celebrating the day that he landed on a Caribbean island. This was one of the most important events in history and it had a profound impact that is still felt today.

Remember, in 1492, the Americas had been separated from Europe/Africa/Asia for 60 millions years (except for ice bridges from Siberia). The five continents were inhabited by people who did not know of each other's existence (or Austrailia) 1492 joined the two land masses. Plants and animals were brought back and forth between the continents. The package of avaible foods increased tremendously.

Also, ideas flowed back and forth. The Americas were populated by stone-age people, many of whom still believed in human sacrifice. Europe had its own version with inquisitions. Out of this grew the most tolerant societies in history.

And it started with a single voyage in 1492.

Prizes and Politics

President Obama won the Nobel Peace Prize. It is rare for a sitting president to win a Peace Prize. It is unheard of for one to win one in his first term, especially since nominating deadline only 12 days into his administration.

It has been no secret that the committee that awards the Peace Prize hated President Bush. They pointedly gave prizes to former President Carter and near-winner Gore. Still, both of those men had a list of accomplishments. Carter in particular had been lobbying for a prize for years.

In contrast, Obama has no significant accomplishments to his name. He has endorsed a nuclear-free world and promised some peace initiatives but nothing has come of them yet. Just yesterday Israel's foreign minister told Obama that a peace settlement was years away.

So the Peace Prize Committee gave out an award based on Obama's star power and the fact that he isn't Bush. In doing so, they made a mockery of all recent recipients and everyone who receives a prize in the foreseeable future.

Arrogance Abroad

Remember back in 2008 when candidate Obama said that he would meet with hostile foreign leaders without precondition? At the time he complained about the policy of treating a visit by the American president as an honor.

Now that he is president, Obama is doing the same thing but with a twist. It isn't that an official visit is an honor, it's that a visit from President Obama is an honor. He and his staff have bought into the rock star persona. This has affected his foreign policy in several ways. The most recent was his pitch to the International Olympic Committee (IOC) to host the 2016 Olympics in Chicago. Where other cities made their case on behalf of their people (especially Rio which pointed out that the entire South American continent had never hosted an Olympics), the Obamas made a personal appeal. Their message was that this was the IOC's chance to do something for the Obamas personally. The President wanted to wrap up his second term by opening the Olympic games. The First Lady just wanted to see the games held in her home town. A sidenote to their appearance was the reminder that they are more important than the IOC - one member complained that Obama's security was so tight that he could not cross his hotel lobby.

Obama's speech to the UN was similar. He told them to forget past US actions and look at the last nine months. He didn't ask them to overlook the last eight years, he asked them to ignore the last 64 years and every president since Truman.

His outreach to hostile countries has also followed these lines. He expects countries to ignore years or decades of complaints and all geopolitical issues and be our friend. Why? Because the great Obama wants it.

At the same time he is dismissive of our allies. He deliberately concealed information about the second Iranian reactor at the Security Council meeting because he wanted a resolution calling for total nuclear disarmament. That news would have spoiled his moment. Both the French and English knew about the reactor and were upset. Obama ignored Gordon Brown's request for a private meeting, probably because it was going to be about the reactor. The press heard about the snub and both countries had to issue press releases saying that we are still friends.

It's hard to know why Obama canceled the missile defense system in Poland. It may have been to mollify the Russians who he has been courting. Regardless, the Poles were not warned in advance and it was announced on the 70th anniversary of a Russian invasion of Poland.

The biggest beneficiary of the canceled missile defense, Iran, showed its gratitude by testing the sorts of missiles that the system was supposed to stop.

Then there was Obama's attempt to restart the Arab/Israeli peace process. He told the Israeli prime minister that Israeli settlements are the only roadblock and all construction in all settlements must be stopped at once. Only after that was done would he talk about nightly missile attacks.

In instance after instance, Obama has ignored history and assumed that he could accomplish feats that eluded others. He cozies up to dictators and ignores friends. He assumes that a childhood in Indonesia and some trips in his 20s gives him insights into the world that elude everyone else. The result of his attitude will be decreased American influence. The first part of that has already happened. The G20 has announced that will will begin using a blended currency standard instead of the dollar as the international standard.

The NobamOlympics

For the last few days we have been told that a direct appeal from Barack and Michele Obama was all that was needed to secure the Olympics for Chicago. After all, even though his domestic numbers are dropping, Obama is still the most popular man in the world. Instead, Chicago was the first city eliminated.

So what happened? There are two possibilities - either Obama isn't as popular as he thought or general world hated of the US is more deeply rooted than simply George W. Bush.

Either way, Obama's world view is naive. Not a good thing for the President of the United States and leader of the Free World.

Update: More here. It seems that Obama acted like an ugly American, showing up and expecting to get the Olympics for no other reason than his presence.

Creating a Public Option

In all of the talk about a public option for health care, there has been precious little information about exactly what this would consist of or how it would be set up. As Ross Perot observed in 1992, the devil is in the details.

Supporters of the public option insist that it will be separate from Medicare (it had better be - Medicare is about to go broke), that it will not receive public funds, and that it will be more efficient than private insurance. This means a new government agency. This also makes it impossible to say that the new agency will not get government funding.

First, let's assume that it starts modestly. The Democrats has given figures of anywhere between 30 and 48 million. Let's assume the lower figure and go with 30 million. Let's also assume that the public option is competitive and offers prices in line with other insurance companies so we will give them 20% of the uninsured and none of the people who are already insured. That's 6 million people. That's a good number for a state but not so good for the entire nation. To put it in perspective, Blue Cross f Western Pennsylvania has 1 million enrolled. Even so, it would have an income in the billions.

So, we now have an agency that insures 6 million people across the entire country. Except we don't have an agency yet. We have to hire people and open offices. That's going to be a minimum of one office per state, probably more if big states. Then there will be one main office, probably in the greater DC area. The new company will need actuaries, adjusters, computers, web sites, clerks, and lots of bureaucrats. That's before it gets its first premium in.

Normally you start companies small by attracting investors. The successful ones grow. The unsuccessful ones go out of business. Not this one. Our hypothetical government agency will start moderately large but too small to cover its expenses. On the other hand it can't fail. The government will not let it.

This will take a big infusion of capitol. The new agency will have to buy everything that it needs and have enough cash reserves to start making payouts the day it goes into operation (remember, no exclusions for pre-existing conditions).

Some of the undefined details become very important here. Will this new agency be expected to repay the government the money that was used to start it? Will it use its revenues to create its own fund for paying benefits? Will it be held to the same standards that private insurance companies are? If it loses money then will the federal government cover its losses?

If any of these questions are answered no then the administration is lying when it says that the new agency will not be taxpayer-funded. This is a slippery question because repaying the money used to create this agency will raise its costs and make it harder to compete. The natural inclination for the bureaucrats will be to have over a pile of money with vague promises about repaying it in the future, promises that will never be fulfilled.

Even if you believe that non-profit government agencies are more efficient because they don't have to pay out profits, a new agency like this would be expected to lose money for years before it stabilized. If the public option is created then it will be a decade or two before we really know what we got for our money.

There is also the question of how the government will handle it if this agency makes money. Will it simply roll over the surplus and lower rates the next year? Will it add the profits to its reserve? Will the profits go to paying back the startup costs? Or will the money go into the general fund?

A related question is how the agency's reserve fund will be handled? All insurance agencies are required to have one by law. This is used for payoffs when claims are higher than premiums. Our new agency will start with a reserve provided by the taxpayers but after that the amount will fluctuate. Will it simply keep the reserve as cash or will it try to invest any excess? Keep in mind that government agencies don't invest, they buy bonds which can only be redeemed through taxes (or by printing money). Social Security and Medicare have deeply "invested" in bonds and paying them back is a crisis waiting to happen.

One of the iron-clad laws of government is that once an agency comes into existence it cannot be abolished. By the time we've determined if this will be a good investment or not it will be far too late to remove.

Glenn Beck and Republicans

There has been a recent debate between conservatives about how they should regard Glenn Beck and other conservative personalities. One side applauds their success, the other is appalled by their antics. Some of this exchange has been hosted at Front Page Magazine which is run by a David Horowitz, Glenn Beck supporter.

The anti-Beck people feel that he is too polarizing and too far to the right. They want a non-threatening Republican party that will attract moderate swing-voters. To them, the Republicans have been losing ground because their message is too focused. Limited government does not attract enough votes. Beck and the others are too shrill and often make mistakes which discredits their side.

The pro-Beck people look at his success in forcing out some of the most ideological members of the Obama administration - people like Van Jones and groups like ACORN. They also support the idea that the Republicans need to stand for something.

So, how do we make sense out of all this?

First, let's admit that Glenn Beck and company are a two-edged sword. They are conservative but they are not automatically Republican. The Tea Party protesters are almost as mad at Bush as Obama. Both presidents pushed unsustainable spending. Some Republicans who tried to co-opt the Tea Parties have been told that they are not welcome. During last year's primaries, Beck, Coulter, Limbaugh, and others made it clear that they were unhappy with John McCain. The fact that these personalities have so much influence but are uncontrolled by the Republican party makes many Republicans nervous. With good reason.

But the question is if the Republicans are better or worse off because of these people. This is a more complicated issue than the anti-Beck moderates make it out to be.

As I said above, the moderates want to appeal to the swing-voters. They want to silence or, at least quiet, the far right who they think scares the swing-voters. They think that the secret to regaining control of Washington is to act as a loyal opposition, trying to moderate the Progrssives' excesses rather than opposing them. There are some severe problems with this strategy.

The first is that it assumes that the Progressives are correct and that the country has moved to the left. These people are trying to move the center to match the new realities. Are they correct in this assumption? The polls don't show it. Also, the idea of playing to the middle was originally proposed by George W. Bush and followed up by John McCain. Bush referred to it as Compassionate Conservatism. Outsiders called it big-government Republicans. It was not particularly successful. Bush lost the popular vote in his first race and won a narrow victory in his second against second-rate opponents.

The 2008 election showed some of the stress lines that this strategy has caused the Republicans. Many conservatives stayed home rather than vote for big-government McCain. Others were not excited about his ticket until he added Sarah Palin to it. Most telling, many Libertarians supported Obama, expecting him to be a pragmatic moderate. I've complained many times that, any time the Democrats can campaign as the party of fiscal restraint, the Republicans have lost their way.

So, the assumption that appealing to the middle and abandoning the principles of Reagan will win elections has not worked very well.

This brings me to the other big problem with the anti-Beck people - demographics. Polls show that the younger voters are far more liberal than the last generation. You can argue, and many have, that this means that the Republicans need to moderate their message in order to attract more younger voters. This is a losing strategy for the reasons I gave above. The Republicans will never win a bidding war against Democrats for more public spending.

The long-term solution is to reach out to the younger generation and start building a new conservative movement. Explain why big government is inherently inefficient and why giving too much control to the government means a loss of liberty. This takes the sort of theatrics that Glenn Beck does. It takes loud, noisy protests. It takes the sort of tactics that the Democrats have been using for decades.

The choice comes down to these two possibilities - move the Republican party to the left or try to revitalize the right. Moving to the left is easy and decorous but it means abandoning many core principles. Revitalizing the right is tougher but has the advantage of a hard-left administration to contrast with. Both options are risky and they are mutually exclusive. Cutting off Beck and the noisy right could result in a new third-party. Embracing them without attracting new outsiders could doom the party to permanent minority status.

Personally, I want the Republicans to stand for something again. I rolled my eyes during most of Bush's deficit budgets and was in shock after the TARP and the other bail-outs. I want to see someone speaking up for limited government and fiscal restraint again.

I don't agree with a lot of what Glenn Beck says but I think that he needs to be given at least as much leeway as the left has given its over-the-top personalities. No one on the left complains about Keith Olbermann and Al Franken was elected to the Senate. We need Beck, Limbaugh, and the others in order to build a new conservative movement and to keep it honest.

Economics for Krugman

Last week, Paul Krugman wrote a column on how economists got things so wrong. He got a few things wrong himself.

First there is the ketchup quote:

Larry Summers, now the top economic adviser in the Obama administration, once mocked finance professors with a parable about "ketchup economists" who "have shown that two-quart bottles of ketchup invariably sell for exactly twice as much as one-quart bottles of ketchup," and conclude from this that the ketchup market is perfectly efficient.

I'm not sure if the original problem here is with Summers or Krugman but Krugman quotes it more than once in his article. There are several problems with this example of market economics.

First, a two-quart bottle of ketchup invariably sells for less than two one-quart bottles. This reflects economies of scale and per-unit costs. As portions become smaller, the cost of packaging, transportation, and shelf space take up a larger proportion of the cost.

Second, supermarkets have been investing heavily in marketing research for decades. What ever price a bottle of ketchup has, it reflects a lot of calculation and experience on the most profitable point. Supermarket prices don't just happen. Krugman thinks that market-based prices arrive at the wrong prince. While they can, and did with the housing bubble, the vast majority of the time they are correct.

Krugman's second problematic example is with a babysitter co-op:

I like to explain the essence of Keynesian economics with a true story that also serves as a parable, a small-scale version of the messes that can afflict entire economies. Consider the travails of the Capitol Hill Baby-Sitting Co-op.

This co-op, whose problems were recounted in a 1977 article in The Journal of Money, Credit and Banking, was an association of about 150 young couples who agreed to help one another by baby-sitting for one another's children when parents wanted a night out. To ensure that every couple did its fair share of baby-sitting, the co-op introduced a form of scrip: coupons made out of heavy pieces of paper, each entitling the bearer to one half-hour of sitting time. Initially, members received 20 coupons on joining and were required to return the same amount on departing the group.

Unfortunately, it turned out that the co-op's members, on average, wanted to hold a reserve of more than 20 coupons, perhaps, in case they should want to go out several times in a row. As a result, relatively few people wanted to spend their scrip and go out, while many wanted to baby-sit so they could add to their hoard. But since baby-sitting opportunities arise only when someone goes out for the night, this meant that baby-sitting jobs were hard to find, which made members of the co-op even more reluctant to go out, making baby-sitting jobs even scarcer. . . .

In short, the co-op fell into a recession.

The analysis that Krugman gives is flawed at every level.

First there is the reason that people hold a reserve of 20 coupons. He says that it is so that they can splurge at a future date. I suspect that it is so that they can quit at any time. The rules of the co-op almost mandate a 20-coupon reserve. You are given 20 coupons when you join and you have to return 20 when you leave. Anyone who allows their reserve to fall below 20 is in debt and will have to earn the difference in order to quit. A different way of looking at this is that you start with a balance of zero but a credit limit of 20 which have to be repaid when you quit.

But that's only part of the problem. The other problem is that this is being presented as a closed system when there are external factors.

Any parent can tell you that it isn't much trouble to watch someone else's child along with your own. It does not double your work, especially if the child that you are sitting is close enough in age to play with your own children (remember that everyone in the co-op has children by definition).

On the other hand, going out represents an additional expense. Dinner and a movie will cost at least $40. So, in order for you to get babysitting work from me, I have to spend an additional sum.

Most people do not send their kids to the sitter every night or even every other night and go out. On the other hand, any parent who is not going out is available to babysit. Since the co-op was established with the expectation that the demand for coupons would balance the demand for sitters, it was doomed from the start.

Also, the prices (coupons) were fixed from the start by the co-op so this example has no place in a discussion of market-based economics. There is no market here. If anything, this is an example of why having prices set by an external authority does not work. Also, if it is hard to find work as a sitter then that makes it harder to repay the 20 coupons when you leave.

This should be obvious to a Nobel-Prize-winning economist but Krugman missed it. He just dismisses it as a recession. He goes on to say:

Freshwater economists are, essentially, neoclassical purists. They believe that all worthwhile economic analysis starts from the premise that people are rational and markets work, a premise violated by the story of the baby-sitting co-op. As they see it, a general lack of sufficient demand isn't possible, because prices always move to match supply with demand. If people want more baby-sitting coupons, the value of those coupons will rise, so that they're worth, say, 40 minutes of baby-sitting rather than half an hour — or, equivalently, the cost of an hours' baby-sitting would fall from 2 coupons to 1.5. And that would solve the problem: the purchasing power of the coupons in circulation would have risen, so that people would feel no need to hoard more, and there would be no recession.

Since the demand for babysitting has an external element, price adjustment will only have a marginal impact. Worse, it would encourage hoarding, at least above the 20-coupon level, since it might take you two evenings of sitting to make up for one night out.

In a normal market, only a subset of the population provides babysitting and they do it for real money instead of hours. The idea of the co-op was to remove the expense of babysitting from the cost of going out. The system that was set up did that admirably. Anyone who needed a sitter would find a large pool of people available. If you stop there then it was a success. It only becomes a failure if you expect an equal number of people to need a sitter and to want to sit. In a population where there was a high demand for sitters and low cost for needed them then this would work. Among a normal population it will always fail.

One final note - any attempt to fix this "recession" is likely to make it worse. There is no way to adjust the co-op rules so that the demand for sitters will match the demand for children to sit. So much for "government" intervention.

"You Lie!"

During last night's speech, when President Obama said that illegal immigrants would not be covered by his proposed health care reform, Rep. Joe Wilson burst out with "You Lie!".

First, this was not appropriate behavior. There was enough of that during the Bush years.

But, what prompted Wilson's outburst? This is where things get tricky. The various health care bills do say that immigrants are not covered but there is no verification. In fact, Republicans have tried to add a verification requirement and the Democrats have rejected it. This means that illegal immigrants probably get coverage even if they are not entitled to it. Obama must know this so he was being disingenuous when he said that they would not be covered.

Obama was disingenuous about other facets of the bills. He continues to claim that early testing will cut costs and save lives. He is only half right there - it will raise costs. He has moderated his promise that the bills will not force individuals or their employers to change coverage but the new taxes and mandates in the bills will certainly force changes.

Regardless, the middle of the President's speech is not the time to argue fine points.

Update - I still think that this outburst was unseemly but it may turn out to be the point where Obama lost the health care debate. The evening news top story was about Wilson instead of Obama. The same thing happened in July when Obama gave a press conference that was mainly about health care but answered one question about a white cop arresting a black professor. Everyone forgot about the rest of the press conference. The same thing seems to be happening - Obama gave a prime-time speech which contained nothing new and was upstaged by two words from the gallery.

Wilson got some action, also. Democrats promised to include some enforcement language in the bills.

What Does Health Care Reform Mean to You?

Forget President Obama's speech. The important details are in the bills working their way through Congress. Forbes analyzes them here. The quick summary is that these bills are awful. Congress realized that they will never pass a bill that adds a trillion dollars to the national debt. They are pledged to come up with a bill that is "deficit neutral".

How can you increase health care coverage without decreasing costs and still call it deficit neutral? By taxing everything in sight.

For example, if you get good health care benefits now (more than $8,000 per individual or $21,000 per family) then your insurer will be taxed a 35% excise tax. Does anyone seriously think that this will not be passed on to the insured or that it will not result in a cap on insurance benefits? So much for promises about not forcing you to change coverage.

There are other new taxes. Drug companies will be taxed $2.3 billion per year divided by their market share. Medical device companies will also be taxed this way. These taxes are designed to be passed on as increased costs so that private enterprise will take the blame instead of Obamacare. At the same time, new incentives will force people to sign up for the public option. It will not be forced on people but it will be the only show in town.

Small businesses will be hit hard. I would not say that the Democrats are planning this but they probably aren't losing any sleep over it, either. Since FDR, Democrats have preferred dealing with a few large companies rather than many small ones. It is easier to control an unionize large businesses.

This health care plan must be scrapped. It takes the worst of the current system and make it even worse. This will be a disaster for the country if it passes.

What Does the Van Jones Resignation Mean?

A funny thing happened over the weekend. Around midnight on Saturday one of President Obama's advisors resigned. Most people never heard of Van Jones until his resignation and most are probably a little confused about why he resigned. The official story is that he used a bad word when describing the Republicans and signed a petition. People on the far left, such as Keith Olbermann-watchers, think that he was the victim of a smear campaign by Glen Beck and others on the right. Olbermann posted on the really-far-left Daily KOS, declaring war on Glen Beck.

What really happened was that Glen Beck and others had spent days digging up embarrassing details about Jones's political beliefs. He is very radical.

The liberal reaction is mixed. Alan Colmes insists that Jones gave up his radical ways nearly ten years ago. He ignores the fact that most of the quotes and positions that have been used against Jones were made after 2000. One clip that Beck ran several times was from early this year.

David Sirota at Huffington is upset because someone from the Progressive movement was forced out. He attributes it to racism and worries about the chilling effect that the resignation will have on progressives who want to go into politics.

These people and others on the left are missing the larger point - that Jones's beliefs may be typical of the progressive movement but they are at odds with the typical American voter. Jones spent the 1990s as a radical communist and never moderated his position very far. Someone who flirted with Deep Ecology (these are code words for "most humans must die") was a special adviser to the President on green jobs. Colmes and the others don't see anything unusual about this. They occupy an echo chamber where everyone is a radical.

This has happened before. Many of Obama's friends and associates are radicals. When they are found out then they are pushed away from the President's inner circle but the big question remains - what sort of man associates with so many radicals?

The School Speech

On one hand, this should be a no-brainer. The President of the United States plans to give a speech to school children urging them to stay in school and work hard. Who could object?

But there is another angle. A beleaguered president, the day before he addresses the joint houses of Congress in an effort to save the signature issue of his presidency gives a speech to school children. The accompanying lesson plans suggest that teachers have the students write about the problems facing the president and how they can help him. Is there any chance that their response will not be politicized?

The Obama administration did admit that the lesson plans were heavy-handed and released revised ones urging students to work on their own, personal goals instead of the President's.

Considering that teachers are one of the Democrats' strongest supporters, I will be amazed if a lot of teachers don't ignore the revised lesson plan and come home urging their parents to support the president.

And that's why people object.

Update:
I read an advance transcript of the speech. It was long, boring and over the heads of most children.

Health Care and Burning Houses

it is becoming common for left-leaning columnists to dismiss complaints about the public option for health care by comparing it to the fire department. Nicholas Kristof is the most recent to make this comparison. According to this argument, we are happy allowing the government to run the fire department so why not let it run health care? There are four major problems with this apples to oranges logic.

1) You can use this to justify a government takeover of everything. If you trust the government to put out fires, why not trust it to run your supermarkets/banks/TV stations? Reasonable people agree that there has to be some limit to government intrusion into people's lives. Otherwise you end up with Communist Russia which was a failure.

2) Buildings are at fixed locations, people move. Having a single location that will handle fires for a given area makes economic sense. On the other hand, people move all the time and their location has no relation to their insurance carrier. There are other major differences. Fires constitute an emergency. Insurance coverage may involve medical emergencies, but it is paid long after the fact. Geography makes it difficult for rival fire companies to compete but this does not apply to insurance companies.

3) There is no good reason why fire departments are government-run. The historic reason is that steam-powered pumps and horses were expensive. These days, fire departments could easily be outsourced if they weren't heavily unionized. Look at UPS and other delivery services which are slowly killing the US Postal Service.

4) I've been saving the best for last - fire departments are run by local government but the public option will be run by the federal government. There's a big difference in accountability between the two. What do you think the reaction would be if the Obama administration proposed a federal takeover of fire departments? The original question treats all levels of government as a single unit. If you correct for that then the question is: "You don't object to allowing your local government run your fire department so why not let the federal government run health care?" Not half as persuasive when you put it that way, is it?

Numbers Games and Health Care

There are some numbers in the health care reform proposal that should be debated but are not even part of the discussion. The idea of universal coverage is that everyone who is not already insured will be required to purchase insurance. Since employer-provided insurance is cheaper than individual insurance, the government will assist those families that need help. The issue is at what level will we provide help?

First, remember that the actual poor are already covered by Medicaid. The people we are talking about are employed and making good wages. The earnings levels I have seen suggested are $66,000, $88,000 and $110,000 per year for a family of four. To put it into perspective, I checked the census data for 2006 (the most recent available). If your family makes $110,000 per year then you are in the top 20% of wage earners. 80% of the country makes less than that but that 80% will be expected to help you pay your insurance. Think about that for a minute.

Now think about this - what happens if the percentage of families buying their own insurance goes up? What if people decide that they will take the amount that their employer now spends on insurance as pay then uses that plus government assistance to buy their own insurance? Is it possible for everyone to subsidize everyone? Picture a large group of people in a circle. Each one is to take $100 dollars from his pocket and put it in the middle. Then, everyone takes $100 out of the middle. By government reasoning, everyone will be $100 richer.

It's all a numbers game, shifting money from one pocket to another.

The other numbers game is one that has been suggested but dropped. Obama has insisted that he will not sign any bill that is not revenue neutral. That means new taxes on someone. The original suggestion was to tax "gold-plated insurance benefits". The implication is that the government will decide how much health care you need. If you get less then you will be fined. If you get more then you will be taxed (a form of fine).

So who gets the gold-plated benefits? You might assume that they go to the rich. While it is likely that top executives get pretty good insurance, someone who is making $20 million a year isn't really worried about whether his co-pay is $10 or $20. It turns out that the group that would be hit hardest by this new tax is union members. The proposal to tax benefits has been quietly dropped with no word on where the new taxes will come from.

Obama - LIberal or Moderate?

This "analysis" from the AP purports to show that President Obama isn't a far-left liberate. He can't be if he has appointed Bush carry-overs. How should we react to this?

The two top posts mentioned are Fed chief Ben Bernanke and Defense Secretary Robert Gates.

The other appointees mentioned are Sheila Bair, chair of the Federal Deposit Insurance Fund; Ray LaHood, Transportation Secretary; John McHugh, Secretary of the Army and Jon Huntsman, ambassador to China. Francis Collins, director of the National Institutes of Health is also listed even thought he is not a Republican. This shows that the list is being padded.

I'm going to ignore the "other appointees" list outright. They make good windows dressing but none of these is in a position to affect policies that are important to the Obama administration.

These choices do shed a lot of light on the Obama administration and its paradoxes. Obama has aggressively pushed for major changes in some areas while keeping Bush policies and, in some cases, Bush hold-overs in others. In many cases, Obama has kept policies that he campaigned against. His Iraq policy is a continuation of Bush's. He campaigned against rendition and tribunals but has allowed both.

I think that there is a very simple explanation. Obama came to office as an ambitious but inexperienced president. He has several areas where he wants to make his mark. There are others that he campaigned on but doesn't really have strong views. That's where the seeming paradox lies. If Obama cares about something then he puts his own man in charge and puts his own stamp on it. If he doesn't really care about it then he appoints a moderate or even a Bush hold-over and lets it continue with little change.

This approach has its uses. The White House can defend itself against charges that it is radical by pointing to the moderates it has appointed. Here's an example:

The notion that he is moving the government to the left "is laughable, it's utterly laughable," said Thomas E. Mann, a government scholar at the Brookings Institution. Mann said the decision to keep Bernanke and Gates "doesn't buy him a thing with Republicans but was a sign of good judgment in both cases" because Bernanke and Gates were doing good jobs.

There are drawbacks. Many of the issues that Obama doesn't care about loom large in the eyes of his supporters. Cindy Sheehan has already pronounced Obama as bad as Bush about ending the wars. Others are upset about the continuation of rendition and the tribunals.

This will eventually come back to haunt Obama. Single-issue voters have long memories and Obama is seen to be forsaking many of them.

The Worst Reasons

If you are a parent then your child must have desperately wanted something impractical. It didn't matter how you explained things, your child still wanted it. If you asked why your child wanted it you probably got the answer, "I just want it." or "The other kids have it." When my daughter was very young this could lead to a red-faced crying fit.

The Democrats are like this about health care. They've been wanting it so long that they don't remember why, they just want it. You can hear this in the different cases they have made. "All the other countries have it," is high on the list. In fact, that and variations on "fairness" pretty much make up the list. All of the talk about reducing costs or "bending the curve" are disingenuous since the current legislation is guaranteed to drive costs up instead of down.

This is also why the Democrats are so confused at the growing resistance to health care reform. They assumed that the entire country has been stewing over the issue since it failed under the Clintons.

Now the Democrats are adding a new reason - it should be passed as a memorial to Ted Kennedy. This is the worst of the reasons since it asks principled Republicans and Blue Dog Democrats to pass something that will affect the entire country against their better judgment as a memorial. Go ahead and name a building after him but don't reshape a big portion of the nation's economy as a memorial to one man. No one was that important and sentiment should not determine the shape of the US economy.

FDR, Reagan, and Obama

Last year, Obama said that he wanted to be a transformational president like FDR or Ronald Reagan rather than a caretaker president. At the time it looked likely. His campaign bordered on a religious crusade and he was the most ideological candidate in years. His followers were expecting great things from him. His party won Congress with a wide majority.

So, eight months later, how is the transformational part working out? Not so well.

FDR set a standard during his first 100 days but his real changes came about during his follow-up, the so-called Second New Deal. That's when Social Security passed. The first 100 days were all about stabilizing the economy.

Reagan's first actions were similar. He got tax cuts and budget cuts (technically they were cuts in growth) passed even though the Democrats controlled the House. He continued the deregulation that had started under Carter. He also beefed up the military.

In contrast, Obama's successes so far have been pretty meager. He ran on changing America, not on economic recovery but most of his early actions were economic. He signed a patchwork stimulus bill and a pork-laden spending bill. He took over the banks and two domestic auto makers. None of these were part of his platform nor were they particularly popular. The White House modus operandi has been to push bills through Congress fast and sign them quickly before the opposition has a chance to resist. This has worked against him. Credit card reform and the expansion of SCHIP passed before most people were even aware that they were being debated. Obama's approach garnered him little credit and no new political capitol.

Obama tried the same approach with health care reform, breaking several promises about transparency, but found that it was too big to push through quickly. Currently it is languishing with major portions still being debated.

This doesn't sound like a transformative president to me. What happened?

The first problem is that Obama has no message. Hope and Change are nice vague terms for winning an election but they don't give much of a mandate. Obama did make specific promises - over 500, more than twice the typical candidate's platform. This further watered down his mandate. Were people voting for him because he promised health care reform or because he promised to get the troops out or Iraq?

FDR had a strong message - "Competition is keeping prices too low. We need to reduce the number of businesses so that the remaining ones can charge higher prices. At the same time we will strengthen the unions so that they can demand higher wages."

Reagan had his own strong message, "Competition is good. It keeps prices down. We need more businesses and less burden from government and unions so that the demand for workers raises wages."

Both men expressed their visions in no uncertain terms. If they had problems getting their legislation through Congress, they appealed to the American people to pressure Congress.

Obama probably agrees with FDR but he has only hinted at it. In fact, whatever his personal beliefs are, he only hints at them. When he does make unguarded comments they reflect badly on him. Obama will never pass legislation while expressing his beliefs about bitter people clinging to guns and religion.

Both FDR and Reagan inspired generations of followers. In fact, they defined the current debate about the proper role of government (FDR=more, Reagan=less). During the campaign, Obama was so coy about his beliefs that most Libertarians voted for him thinking that he would be a pragmatic centrist.

In order to be a transformative president, you have to have a clearly defined philosophy. Without that, you are a caretaker administration.

Now, there's nothing wrong with being a caretaker. Most presidents are. That's why only four of them were carved on Mount Rushmore. The country can't handle new transformations every 4-8 years. It's hard enough to be a successful caretaker president. In the last 50 years, only three presidents have managed to serve a full two terms. The others are usually counted as failed presidencies. Even Kennedy who probably would have been reelected couldn't translate his popularity into political results.

So where does that leave Obama? He has two choices. He can define exactly what his vision is and try to win the country over to it, then use that, as Reagan did, to push his favored legislation through Congress. This will be tough. Defining visions are what campaigns are all about and Obama has three years before his next campaign starts in earnest. In the meantime, trying to sell a message without a campaign is nearly impossible. The White House has already tried to mobilize its campaign to sell health care. They failed. There is the additional problem that the country might not like what Obama is selling. The Democrats are have moved to the left but polls show that most of the country is still conservative. Admitting that he is a radical might hurt more than it helps.

The other option is to take the Clinton approach. Move to the center. Steal ideas from the right. The left will hate him for it (as they did Clinton) but it is a proven way to salvage a presidency.

Defaming the Dissidents

Ever since protesters started showing up at town hall meetings, the left has been belittling them. First they were paid "Brooks Brothers" protesters. Then they were a threat to free exchange of ideas.

More recently the left has focused on two things. One is that several protesters carry signs calling President Obama a Nazi. This has caused an uproar from the left. "How dare you compare the President to someone so evil?"

The other thing has been that a few protesters had guns. One was carrying a gun illegally. Others were carrying legally. The left's take on this is that it is meant as intimidation. MSNBC showed one protester with an AR-15 across his back and talked about racist white militia members. The protester in question was black but they had only shown close-ups of his back so that this was not obvious.

One way to react to this is to dismiss it as simple hypocrisy. The left never had any problems with paid protesters. MoveOn seriously considered running an ad during the Superbowl that showed President Push morphing into Hitler. No one on the left complained that this was over-the-top. Democrats don't believe in guns but last November, members of the New Black Panthers stood outside a polling place carrying clubs and shouting racial epithets. Again, no reaction from the left.

So is this just a matter of the left objecting to its own tactics when they are the subject? I don't think so.

I think that this is a concerted, if ineffectual, effort to discredit the protesters. This is a page from Saul Alinsky. It is easier to attack an individual than his ideas. If the left can make the protesters seem like a bunch of nuts then they don't have to defend their health care proposals. They are the ones trying to shut down the debate...

Protester: According to the CBO, your health care proposal will bend the curve up instead of down.

Democrat: You're ugly.

New York Times Columnist: These protestors are ugly so we shouldn't listen to them.

Centerpiece or Sliver?

President Obama insists that the public option was only a "sliver" of health care reform. The reaction from the left makes you wonder. New York Times columnist, Bob Herbert, seems to think that without a public option, the reform will only make things worse.

Giving consumers the choice of an efficient, nonprofit, government-run insurance plan would have moved us toward real cost control, but that option has gone a-glimmering. The public deserves better. The drug companies, the insurance industry and the rest of the corporate high-rollers have their tentacles all over this so-called reform effort, squeezing it for all it's worth.

Meanwhile, the public — struggling with the worst economic downturn since the 1930s — is looking on with great anxiety and confusion. If the drug companies and the insurance industry are smiling, it can only mean that the public interest is being left behind.

I could quote others but their complaint is always the same - we have to have a public plan or we will not have real health care reform. What is there about a public plan that is so appealing?

The obvious starting point is that the left hates to see anyone make a profit and hates it worse if they are making a profit from human misery. Obama describes it this way:

{...} a system that often works better for the health-insurance companies than it does for them.

But if that was all there was to it then why create a government-owned and controlled competitor? The government just passed sweeping reforms on what banks can and cannot do with credit cards. Why not do the same thing with health coverage? After all, health care reform is being rebranded as insurance reform. Is there more to this?

The right has been afraid that the public plan was a backdoor way of passing single payer. From the reaction on the left, they thought so, too.

Obama and the Public Plan

Yesterday's top story was that the White House was backing off of the requirement that insurance reform include a public plan. My reaction was that if this was true, it meant that Obama would get his package. By today the message it more mixed. It may be off the table. It may still be on the table. It may even be on the table but hidden to be revealed at the last second.

If the public option is not dropped and Obama's health care plan passes then this will be the biggest reason for the failure. Pundits will talk about death boards and town hall meetings but the public option is the real reason that health care is in trouble.

To conservatives and insurance companies, the public option is a back-door way of implementing single-payer. Conservatives don't want the government running such a large portion of the economy and the insurance companies are sure that they will be forced out of business. There is good reason for these fears. European countries that offer the public/private mix have the majority of the population enrolled in the public plan. The private plans sometimes exist only for the wealthy and government workers.

If you think that the public plan will be comparable to private coverage then explain why the Democrats have consistently rejected amendments that would force them and their staffs to switch to the public plan?

Here's another factoid - when it passed, Social Security only covered around half of the population. Once government programs start, they tend to expand.

Obama's justification for the public plan is that private, for-profit insurance companies can't be trusted. They need competition from the government to "keep them honest". Other, high-ranking Democrats have admitted that the public plan is a back-door to single-payer, just as the other side fears. They tend to say this quietly. I have seen them quoted but I couldn't find and of the quotes when researching this post.

So, by including a public plan, the Democrats have energised conservatives who are willing to work against the reform package. They have also mobilized the insurance companies who are providing the financing. In the meantime the drug makers are funding the pro-reform movement in exchange for not being subject to price controls.

If Obama dropped the public option for real then much of the opposition would vanish. He could make a deal with the insurance companies. They stand to gain millions of new customers from the universal coverage requirement. If they switched sides then the conservatives would find themselves heavily out-spent and missing one of their central arguments against reform.

It shows how heavily Obama was influenced by Saul Alinsky and other socialists in his youth that he is willing to give up easy passage because of an innate distrust of for-profit companies.

There is one possibility why the White House is being so coy about the public plan. Howard Dean suggested that both Houses of Congress pass a measure without a public plan then insert it during the budget reconciliation process. This would only require 51 votes instead of 60 to pass the Senate and wouldn't give health care opponents enough time to re-mobilize. That would be a betrayal of Obama's promises of open government but he turned his back on that one with the first bill he signed.

Clunkers and Winners

Last weekend I was camping in Indianan. Someone else at the event had his brakes go bad on the drive there from Wisconsin. He had his van checked. The master cylinder and the brake lines needed replaced. The van was a Chevy Astro and GM hasn't made replacement parts for it in years so he would have to find parts from a junked Astro. He decided that this was going to cost way more than the van was worth. Instead he planned to donate the van to a local charity, drive home in a rental car and buy a new car there.

After talking with his family they decided on a different plan. His father-in-law would drive down with a truck and haul the van back home. Then the would trade the van in for Cash-For-Clunker money.

There are several winners and losers here. The big winner was the owner of the van. He was going to get a government check for several times the worth of a van that would have ended up scrapped, anyway.

The losers are the charity that would have gotten the van. They wouldn't have gotten much for it but now they will get nothing. Multiply this by thousands to see the true effect on charities.

I'm not sure about the rental industry. They rented a truck for a round trip instead of a car for a one-way trip. One-way rentals are expensive for the renter and inconvenient for the rental agency. I'll call this one a wash.

Astro owners in general are slight losers. That's one fewer Astro to be broken down for spare parts. Instead it will be crushed. One van doesn't make much difference but multiply that by thousands and you are setting up for a spare parts shortage for years to come.

I don't know if the automobile industry will come out ahead or break even. They were going to sell a new car, regardless. They might sell a more expensive one because of this. Or they might not.

The biggest loser is the US taxpayer. We subsidized a transaction that would have heppened anyway. We paid several times what the van is worth to no real effect since it would likely be scrapped anyway.

Death Panels, Nazi symbols, and the Health debate

August is traditionally the month for crazy news stories. Normally Congress is out of session and the president is on vacation and there is little actual news to report on so reporters fill the air with stories about shark attacks and anything else they can find.

This year the politicians may not be in Washington but they are not on break. They are trying to drum up support for Health Care Reform. At the same time, opponents are trying to stop them. This is leading to all sorts of irrelevancies. For example:

Death panels. Sarah Palin talked about the establishment of death panels that would rule on who got to live. While her language is colorful, she was probably referring to something like Britain's NICE standards. These attempt to rate cost against quality of life in deciding what treatments will be allowed. When a woman at a town hall asked President Obama about a pacemaker for her then-100 year old mother, she was referring to this sort of cost benefit. Obama's answer wasn't comforting. I assume that Governor Palin was under this sort of pressure when she was pregnant with her son Trig to have an abortion.

While we might see something like this eventually established, it is not part of the current bills.

Nazi Symbols. Nancy Pelosi claimed to have seen protesters carrying Nazi symbols outside a town hall meeting. CNN checked. There was a sign with a swastika that had a circle and a line through it. In other words, it was a "no Nazi" sign. There was also a sign with Obama sporting a Hitler mustache. Pelosi gave the impression that the protesters were neo-Nazis when that's what they were calling her side.

Organized protests. The left has been insisting that the protests are organized and packed with people from outside the district. This is an attempt to discredit the protesters. To date, all that anyone can find is that anti-reformers have sent out email alerts and urged protesters to attend these meetings. This is exactly the tactic used by the supporters. This doesn't matter. The important thing for the Democrats is to get out a message. They know that few people will bother to look for the truth.

ReBranding. Most people are already insured so they rightly wonder what is in it for them? The two points that Obama is insistent on are universal coverage and the government option. Neither of these will help people who are already insured and they know it. Obama finally figured this out and launched a new message - that the whole thing is nothing more than an insurance bill of rights. If that was true then it would have already passed and been signed. This is only a small part of the reform bills. Similarly, Obama tried telling people that he is actually thrifty and will not sign a bill unless it is deficit neutral. While the White House is still trying to convince people that the bill will be paid for through increasing efficiencies in the system, this is an exaggeration (and I'm being kind). There will be a tax increase as part of it and it will hit most of the population.

Health Care Crisis. Obama insists that we are in a crisis. He tosses around the figure of 46 million without insurance. What he doesn't mention is that this includes 10 million illegal aliens. When asked, the Democrats insist that they will not be insuring illegals. So why include them in the count of the uninsured? To make the number scarier. In truth, a large percentage of the uninsured are gambling that they will not need coverage. They prefer to keep their money rather than spend it in insurance premiums. If asked, they would probably prefer to be left alone but they have to be included, also. The bigger the number the more the perceived urgency.

In his first few months in office, Obama took over the financial sector and the big three car makers. Now he is trying to take over energy and health care. People are rightly asking what he will be taking over next year? The speed that Obama is using to take over portions of the economy is scaring people. It doesn't help that the Demcrats made a big thing out of being Progressives and that the fascists rose out of the early-20th century Progressive movement. In pushing a bill that isn't even written yet, Obama is scaring otherwise reasonable people. I've said before that he should be spending his time on the economy. Health Care Reform is something for a country that feels financially strong, not one reeling under mounting debt and unemployment.

President Bush Saves the World

According to Paul Krugman, the country, and by extension the world, has been saved from a repeat of the Great Depression by big-spending government. He dances around the subject quite a bit and gives credit to Obama's stimulus but that isn't really credible. The stimulus has barely started spending any money and reports show that it is not being targeted very well.

So what did save the economy? It must have been Bush and the TARP. That's what kept the banks in business and TARP money was used to bail out GM and Chrysler. Obama's actions have been more follow-up than leadership on these issues.

Of course, Krugman would rather chew off his right leg than credit Bush with doing anything right so he is left with applauding Obama for a yet-to-be-spent stimulus package.

Since Obama has spent most of his time in the White House complaining about the "mess" that Bush left him, it would be nice to hear something nice about the Bush administration. Not that this will ever happen.

Stifling Debate

An official starts to address a gathering of people to explain his position. Suddenly a protester stands up and starts making a disturbance. Is this a danger to democratic society? Something that must be suppressed? Or is it an example of constitutionally protected free speech?

Not so strangely, it depends on who is being interrupted. Currently the Obama administration is upset because tea party protesters are disrupting town hall meetings on health care. Several points should be considered:

First, this sort of behavior is nothing new. The left has been doing it constantly for decades. Speakers such as David Horowitz can expect that any time he gives a talk on campus, the front row will be filled with hecklers who have no intention of letting him speak.

The left had a blind spot about this. Talking Points Memo recently debated if they ever did this. Some people felt that they had done it during the Bush proposal for Social Security reform. Others felt that it hadn't happened since the 1960s. No one seemed to realize that it happens regularly.

The second point is that the White House is attempting to stifle the debate on their own terms. The whole purpose of the town hall meetings was to put out a controlled message. The President's town hall meetings are stacked with ringers from his campaign. They are trying to keep opponents from being heard. They even set up a special email address for people to forward anything that looks "fishy" to. It is unclear if this will be used to formulate responses or to threaten people who are disseminating the wrong message. Regardless, with the Democrats controlling the White House and Congress and a sympathetic press controlling CBS, ABC, NBC, CNN, and MSNBC, it is not surprising that people are copying tactics from the left to get their message out.

The third point is that the administration is spreading a lot of misinformation. The protesters are justified in calling them liars when they are not telling the truth. When the President of the United States tells lies on prime time, then what are average citizens to do? (The same thing that they did when no WMDs surfaced in Iraq.)

Finally, the left is insisting that the disruptions are being caused by paid agitators but has so far failed to find any. The closest that they have come is an overlap in volunteers.

For the record, here are a few statements that are being put out:

If you are satisfied with your doctor or health plan then no one will make you change it. Truth - Assuming that your current plan meets the new standards, it is up to your employer whether you will keep it or switch to a different plan or the public one.

Health Care Reform will cut health care costs. Truth - the current proposals are more likely to push future costs up than down.

You will not be forced to pay for abortion. Truth - a news story yesterday said that the public plan probably would include abortion.

This will not lead to single-payer. Truth - Based on other countries such as France, it will probably lead to a de facto single-payer covering 80%-90% of the population.

The Automotive Model

President Obama says that we need health care reform in order to "bend the curve down." By this he means that we need to do something to keep health care costs from rising faster than inflation. The trouble is that none of the proposals being debated really address this. That's why we have all of the talk about rationing. As costs go up, the amount of services available to individuals will have to be reduced.

Will Obamacare solve this? No. France and Germany are close to the various public/private models being debated for Obamacare. They also come in after the US in the amount spent per capita on health care and they face the same problem with rising costs that we face. They also get less for their money. The survival rates for the most cancers range from slightly better in the US to much better for prostate cancer.

There is some talk about cutting Medicare but simply allocating less money means more rationing. This leads to human-interest stories about people being denied care and a return to previous funding.

Obama insists that the problem of rising costs is caused by greedy doctors who order too many of the wrong type of test (and not enough of the preventative tests that Obama insists will lower long-term costs). In his rush to find villains, Obama overlooks the fact that greedy insurance companies are not going to pay for unneeded tests. Obama's distrust of free markets makes him look for him to see rising costs as an indicator of insufficient government control. There are other factors, many of them byproducts of government policy.

One factor is the cost of malpractice insurance and the cost of "defensive medicine" - tests done in case of future lawsuits. Obama announced early on that malpractice reform would not be part of health reform. This kept the trial lawyers happy and they are one of the Democrats' biggest sources of money. It also eliminated a major tool in controlling costs.

A big problem with insurance is how it is handled. Most people do not buy insurance. Their employer buys it on their behalf. This came about mainly due to the progressive tax rates prior to the Reagan administration. The tax rates were not indexed to inflation so it was very easy for a cost of living increase to push someone into a higher tax rate and result in less actual take-home pay. At the time, most benefits were deductible so applying a cost of living increase to a benefit was a way of beating inflation. This gives individuals an incentive to run up their insurance costs. I know people who believe that a benefit is wasted if it isn't used so they try to get as much out of their insurance as they can.

With most people covered through their employer, insurance companies didn't have any incentive to sell to individuals. There is more profit in group sales than individual sales. This makes it harder for individuals to get insurance. This is also where a big part of the 47 million uninsured figure comes from. Anyone who is unemployed for any length of time is included in this figure.

One solution that I have seen being talked about in conservative circles is to treat health insurance like automobile insurance. You are responsible for buying your own instead of it being bought on your behalf by your employer. You would choose the options and amount of coverage that you need and can afford. Many regular things either would not be covered or would have a deductible. You don't expect your insurance to pay for oil changes, brake jobs, or new tires. Why should insurance pay for check-ups?

Many people are already doing this. They buy cheap catastrophic-coverage and pay other expenses out of pocket. This is one way of bending the curve down. If a doctor says that your headache is probably just that but that you could have a CAT scan to be sure, you are much more likely to agree if the test is covered by insurance.

This is the opposite from Obamacare. The President says that he wants more poeple being tested and that he does not want any co-pay for these tests. This represents two different points of view of medical tests. One side wants to leave the choice to the individual. The other side does nto trust the individual to make the correct choice and wants to test everyone.

Complicating this is the fact that most people are healthy so most tests are not needed. Worse, some tests produce a high number of false positives. This can lead to unneeded treatment. The PSA test for prostate cancer is an example of one that has a high number of false positives. It also detects any cancer, no matter how small. Since prostate cancer is slow-growing, a man can have it for decades without needing treatment. A review of PSA tests found that positives were often followed up with unneeded agressive treatment.

All of this should be part of the national discussion. Instead the debate is centered exclusively on insuring the most number of people and regulating minimum coverage.

Why 3 cents?

One proposal to help pay for medical reform is a $0.03/can tax on soft drinks. Why three cents?

It's a bribe for the soft drink companies. Vending machines don't take pennies. Amounts have to be divisible by increments of five cents. If a three cent tax is imposed, they will raise prices a nickel and pocket the difference. All complaints will be directed at the government.

The White House and Congress are already fighting the insurance companies. They don't need new enemies.

Obama, Gates and Crowley - a few thoughts

It is obvious that Gates' defenders either have not read the police report or are ignoring it in the hopes that their readers have not read it. The most common phrase that they use is that "Gates was arrested in his own home." After that, they speculate that Gates should have simply walked away.

According to the police report, Gates admitted Crowley into his home to show the sergeant some id. He was also agitated. Gates's own account indicated that he was sure that Crowley was a rogue, racist cop immediately. According to the police report, Crowley was convinced that Gates belonged in the house. Gates was still yelling at Crowley, demanding his name and badge but not staying listening when Crowley gave it to him, twice. Crowley gave up and left the house. If Gates had left it there and complained through official channels then there would have been no story. Instead, Gates followed Crowley through two rooms and onto the front porch where he continued to call Crowley names, this time in front of others.

In some neighborhoods this could have started a riot but I doubt that Cambridge is one of them. Crowley could have left Gates to rant to his audience. Instead he warned Gates twice that he was becoming disorderly. Keep in mind that, at this point he was not in his own home. He was on the front porch. There are lots of things that you can do inside your house that you can't do on the front porch. Crowley decided that shouting racial diatribes was one of those things and arrested Gates.

So, by my count, Gates had at least three opportunities to calm things down and Crowley had one.

Why is this incident still news? Because it is polarizing. It is easy to side with one of these men and overlook his part, giving complete blame to the other. That's what President Obama did last week when he said that the police acted stupidly. Obviously, Gates also acted stupidly but Obama still seems blind to that.

A few days ago Glenn Beck used the incident to call Obama a racist. While I don't agree with him that Obama hates white people or white values, there is a double standard here.

First for anyone who is upset by Beck's statement, I'd like to know what their reaction was when people called George W. Bush a racist and accused him of allowing, or even ordering, New Orleans flooded? This was a much stronger accusation than Beck's but I don't remember anyone being fired or even disciplined for saying such things. So, if it was ok to call Bush a racists then why not Obama? Obviously it is because Obama has darker skin and many people believe that racism is ok as long as the racist is black.

Another double standard is Obama's set of friends. He counted the Reverend Wright as a close friend and advisor until videos of Wright peddling racial hate came to light.

Professor Gates is another example. His entire career is based on racial grievances. He is a believer in conspiracies against blacks as a race.

What does it say about Obama that he counts these men as friends? If the races had been reversed then association with either man would have doomed a white politician's career.

Obama can imply that the typical white person is a racist but Joe Biden's presidential run crashed and burned when he described Obama as "articulate", possibly implying that there were black men who are not articulate.

Whites are beginning to resent the one-sidedness of it all. Not long ago Crowley would have been dismissed as the rogue, racist that Gates described him as but things are different this time. The police force stood up for him and whites are saying that Crowley may have over-reacted but he would probably have done the same thing to anyone shouting at him regardless of race.

Ironically our "post-racial" president contributed to the national debate. If he had simply said that both sides had acted stupidly then neither side could have complained. Instead he sided with his friend. Years from now historians may look back at this as the event that unravelled the Obama presidency. (Actually, health care reform was already in trouble which is why he was giving a prime-time news conference in the first place but historians will still say that the Gates incident was the biggest factor).

Birthers

If you are a Birther (you think that President Obama was not born in Hawaii) then please shut up. There is nothing to this and you are embarrassing the rest of us. For the last eight and a half years conservatives could sneer at liberals afflicted with Bush Derangement Syndrome as they talked endlessly about conspiracies within the Bush administration. Now we have our own affliction - Obama Derangement Syndrome.

Think about the whole controversy for a few minutes...

Why would Obama's parents have bothered arranging for fake birth announcements and fake birth registration? His mother was a US citizen so it doesn't matter where he was born (remember that McCain was born to American parents in Panama).

Barack, Sr had a very good reason to keep his mother from going to Kenya - his first wife who he abandoned without a divorce (he did this to Obama's mother a few years later).

If there was anything to this then Hillary's investigators would have found it two years ago. They were responsible for other damaging leaks about the Obama campaign.

The whole conspiracy theory seems to be based on the pre-knowledge that Obama would someday run for president. While it indicates a touching faith in Obama's parents aspirations for their son it's a lot of trouble to go through for a 300 million to one shot that their son would someday run for president.

The conspiracy theory is silly enough that liberals are using it to discredit all conservatives. All they have to do is bring on a Birther or two and represent them as more mainstream than they are.

One thing that I will say about the conservative reaction to the Birther movement - a number of conservatives have stepped forward to denounce it. I can't remember any liberals questioning the 9/11 Truth movement. Howard Dean, when he was still the front-runner in 2004 seemed open to the idea that Bush was involved in the 9/11 attacks. Other high-ranking Democrats included this in the long list of things that they wanted to hold hearings on. Republicans joined Democrats in unanimous support for a bill honoring Alaska's 50th anniversary as a state and as the birthplace of Barack Obama.