The Only Republican in San Francisco

Romanticising poverty

Radley Balko over at reason does a fine job skewering the idea that poverty somehow brings people together.

Let's put this idea -- rooted in a Jesus-at-the-temple ethos against material wealth, and often embraced by people who have never been poor -- to a common-sense test.

The poorest parts of this country, or your city: how do they rate in terms of violence and social discord? How does that compare to the wealthiest parts?

How about the stability of family in those areas? In fact, marriage and income remain closely correlated.

When the return on investment for crime rises, such as in situations of economic frustration and hoplessness, do we expect it to rise or to fall?

I put this is the same bucket as those who seek to "protect" native cultures from the ravages of economic progress. As if people choose to live in mud huts when they have other options.

Obama to GOP governors: an offer they can't refuse

Now that the "stimulus" bill has passed, with big $$ earmarked for state governments, GOP governors are apparently torn as to whether to take the money. On the one hand, that money, like other pork, is a benefit to the recipients. Intelligent folks also realize that every one of those dollars comes from someone else, presumably in another state, and so the loss is equal elsewhere.

Herein lies the insidiousness of big public spending: once the money is spent, it is in the interest of citizens to clamor for their share from government. Such clamor begets more spending. Etc.

We know that such spending is, at best, a net-zero transfer. In reality, after accounting for waste, deadweight loss, lobbying and straight corruption, such spending makes us all poorer.

Republicans, in theory, feel strongly about this. Republicans are also, sadly, politicians.

If the stimulus money is going to be spent regardless, is it in the interest of a governor to refuse it? All they are doing is depriving their state of their share of a pool that their citizens have involuntarily paid into, as federal taxpayers. If you don't accept the money, your constituents will feel doubly-robbed.

Think of it this way: Your house, and your neighbors', have been looted and the booty has been thrown into the public square. Certainly, you are against such looting. But now your couch and TV are sitting in a pile that others are gladly helping themselves to. What to do?

This is Obama's (and Congress's) plan with the stimulus. You've paid in. Now the proceeds will be distributed. It's clearly in your interest to accept some of the loot. (Social Security is built on the same premise, and FDR stated as much.)

For GOP governors, like every other politician, their morality is now in direct conflict with their political interest. The stimulus turns citizens into beggars demanding their handout. And while the citizens might understand the source of their poverty, they have no choice but to become supporters of the spending.

The only solution is to prevent such spending in the first place. The greater the spending, the harder such political will becomes. A tall order indeed.

Fear is its own stimulus, or the roundabout Keynesian

Earlier I speculated that we might have an unintended stimulus: fears of future inflation encourage people to spend now while their dollars are worth something. It's roundabout Keynesianism -- the government "jolts" the economy back into shape by scaring the sh*t out of those who understand inflation.

Michael Kinsley touches on this in the WashPo:

If it's not the actual, secret plan, it will be an overwhelming temptation: Don't pay the money back. So far, even as one piggy bank after another astounds us with its emptiness, there have been only the faintest whispers about the possibility of an actual default by the U.S. government. Somewhat louder whispers can be heard, though, about the gradual default known as inflation. Just three or four years of currency erosion at, say, 10 percent a year would slice the real value of our debt -- public and private, U.S. bonds and jumbo mortgages -- in half.

Get it? It's a slow, large tax. The money you have in the bank will be worth half of what it was. The losers will be those who made good decisions (by saving and making sound investments) and the beneficiaries will be those who didn't (overspenders, housing speculators, frauds).

In this way, inflation fits with everything the Obama administration has done to date, which is to move money from wealth creators to wealth destroyers. (Bush did too, btw).

Similarly, the administration will get away with it on a rhetorical level: “Inflation? We're working on it. But we won't raise your taxes!”

It's like how they call it a “tax cut” when they send a check to someone who doesn't pay taxes. Genius.

Crisis of Credit visualized

Really interesting:

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Did we say $800,000,000,000? We meant $3,270,000,000,000.

I mean, I am a generally skeptical sort. An empiricist, if you will, though I generally avoid -ist's and -ism's.

Things are true only after they've turned out to be so, and not because we really believe they should. Prediction is interesting and useful, but it's no substitute for actual outcomes. (Can you tell I've read The Black Swan?)

So my question to dear readers is, do you believe what you are being told about the stimulus? For example, do you believe it's a one-time spending boost? Do you believe it's $800b?

In actuality, the cost of the bill is around $3.2 trillion. You (we) have been low-balled, which is a nice way of saying bullshi**ed. Just the interest alone is around $750b.

Here's what it looks like in terms of debt:

From WSJ

Observant folks might recognize that those numbers look a lot like Japan during its lost decade.

The US might recover despite the stimulus, in the way that one might recover from a gunshot wound. But we'll be a lot poorer. More likely is stagnation (as the $$ incentive of starting a business or hiring employees has been reduced) with inflation (there are twice as many dollars as there used to be, chasing the same amount of wealth).

I am both a progressive and a liberal  -- I just take those words at their literal meaning instead of their political meaning. I see "progress" in the creation of new, for-profit medicines that would not have existed otherwise. I see liberation in Wal-Mart, which helps to make most people's physical needs easily satisfied.

These are the sorts of things that will come to an end due to our new indebtedness. The ones who will get by are those who are paid in tax money, and the super-rich. You'll start to notice they are the same people. And they are the ones with the political power...notice a pattern?

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Update: more and smarter from Megan McArdle.

AFSCME: I thought Obama rejected public campaign financing?

AFSCME (American Federation of State, County and Municipal Employees) and others have launched an ad campaign against the GOP leadership. It was apparently coordinated with the White House:

White House aides were told in advance what the concept of the ads would be, though they were briefed while the ad was in production, according to a Democrat familiar with the discussions.

Let's set aside whether that's legal, for a moment. Instead, please note that tax money is explicitly paying for these ads. The AFSCME union is funded by the paychecks of government employees.

We shouldn't be surprised by the campaign -- after all, the "stimulus" package is largely intended to fund unions, either at the federal or state level. So what we have is taxpayer money being used to advertise for more taxpayer money, by the people who will be receiving that money.

Now, the coordination with the White House raises an eyebrow: after all, candidate Obama rejected public financing and instead went free-market for his campaign donations. Now he is the beneficiary of public money being used to promote his political goals. Ironic.

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Update: apparently the AFSCME folks are a little miffed about a parody video "that portrays AFSCME union members as 1970s-era goons". I dunno, what do you say about an organization that forcibly collects dues from non-members?

Sitting in the back of the (omni)bus

The omnibus "stimulus" bill currently before Congress is packed with all sorts of initiatives that have very little to do with our current economic situation. If each of them has merit, shouldn't they be separate bills?

One example is the modernization of medical records. It might be a great thing, or it might be government creating new bureaucracies. It might be too much, or too little. So why doesn't Congress put forward the Medical Modernization Act of 2009?

Another example is $9 billion for "broadband". Notwithstanding that broadband is being deployed apace by the private sector -- shouldn't this be debated on its own merits, and over time? Instead, it's been bolted onto a piece of legislation so large that there is little hope of experts weighing in in a serious way.

If we've learned anything about healthcare and technology, it's that the devil is in the details. And the details are being papered over.

This leads me to believe that the new administration wants it this way. Rahm Emanuel has said as much. The only conclusion to draw is that our leaders believe that public debate will hurt these initiatives -- a deeply offensive idea.

By making this a rushed, all-or-nothing proposition, the American people are being pushed out of the debate. We are being asked to sit in the back of the (omni)bus.

Already sounding old

I just had a look at President Obama's op-ed in the Washington Post. Is it me, or does the rhetoric sound very...2008?

Every day, our economy gets sicker -- and the time for a remedy that puts Americans back to work, jump-starts our economy and invests in lasting growth is now.

Now is the time to protect health insurance for the more than 8 million Americans at risk of losing their coverage and to computerize the health-care records of every American within five years, saving billions of dollars and countless lives in the process. 

Now is the time to save billions by making 2 million homes and 75 percent of federal buildings more energy-efficient, and to double our capacity to generate alternative sources of energy within three years. 

Now is the time to give our children every advantage they need to compete by upgrading 10,000 schools with state-of-the-art classrooms, libraries and labs; by training our teachers in math and science; and by bringing the dream of a college education within reach for millions of Americans. 

And now is the time to create the jobs that remake America for the 21st century by rebuilding aging roads, bridges and levees; designing a smart electrical grid; and connecting every corner of the country to the information superhighway.

Now is the time! It's the same bollocks and talking points that we heard over and over on the campaign trail. The rhythms and repitition are aimed at those who are charmed by such things -- the same drones who are prone to chanting his name, perhaps.

Obama's good at campagining. He's got no track record of doing anything else. Will 2009 be another campaign year?

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And did he really say "information superhighway"?! Holy 1998!

A quick bit on percentages

Rasmussen's latest poll says that support for the stimulus bill has dropped from 45% to 37% in two weeks.

That's a big drop, but it's easy to undertstate how big a drop it is.

Is it an 8% drop? No. It's an 8 percentage point drop.

Support for the bill has actually dropped close to 18%. 8 is around 18% of 45. So if the poll is to be believed, one of every six people who supported the bill two weeks ago, no longer support it.

It's almost like citizens are taking their time, reading the bill, and drawing their own conclusions. Exactly the opposite of what Obama and the Dems are asking them to do. Quelle horreur.

Hair of the dog, or sleep it off?

The first of a few strained analogies bouncing around my head.

So. You were drunk. Really drunk. It's now 6am, and you've woken up at the bottom of the stairs. You remember tumbling down them some hours before.

You had a great time. Hey, I was there -- I had a great time too.

But now you feel awful. You've vomited up the expensive, four-course meal that you enjoyed so much. Perhaps you overpaid.

You are wondering the best way to get back to the healthy, happy person you normally are. A couple of choices...

Hair of the dog that bit you. This is a colloquialism for having a little drinkeepoo to get you through the hangover. Maybe a couple of beers with breakfast? I hear it helps. But it seems to me that you'll just get another hangover a few hours later, and it will be just as bad. Your recovery will have been delayed. And you'll (justifiably) feel like an alcoholic.

Sleep it off. Seriously, your body needs to recover. You poisoned it with alcohol. You robbed it of nutrition. So do something that actually contributes to your health -- drink a tall glass of water and go to bed. I would understand if you take an advil or two, we all need some help getting through the pain. But the only road to recovery is to contract into bed and regain your strength.

So -- which route is our drunken Congress choosing?