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There’s been a lot of back and forth between pro-nanny state folks and pro-market folks concerning the impacts of either policy on job growth.  On one hand there is the argument that the uncertainty of regulations causes a pause in investment.  The case being that businesses are unable to predict the return of their investment due to unknown costs in the environment.

I have suggested in the past that this is akin to playing blackjack.  Consider the game as we know it.  A dealt 21 is a winner at 150% of the wager.  Dealer has to hit up to 16 and wins on a tie.

Further consider a table of players.  Upon being told that the rules might change mid “shoe”, that the changes to the rules are not yet finalized and that once you commit to playing, you can’t back out, do you think the players would play more, play less or play the same?

I suggest that the players would “hold onto their capital” until they knew the rules, and then, based on the new value proposition, would play at a level that reflects the advantage to the house; less play if the rules benefit the house, more play if those rules benefit the player.

Why we would expect business to react differently isn’t rational.  And, as it turns out, is exactly what we are seeing:  Hat Tip Carpe Diem

Because we don’t know what our health-care expenses will be in two or three years, we are unable to determine with any certainty how much our investments will have to return for us to be profitable. All of that counsels in favor of holding off on new investments and saving our funds. We want to grow. But we are unable to do so knowing that large and undetermined liabilities will absorb funds we otherwise would invest for expansion.

It is simply not reasonable to suspect that people or organizations will invest at the same level when the risks are unknown.

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Disclaimer:

This is a topic that earns conservatives a bad name.  Or rather, this is a topic that liberals are easily able to use in order to give conservatives a bad name.  This is an unfortunate reality, for IN reality, it is the conservative that gives more to charity than the liberal:

The fact is that self-described “conservatives” in America are more likely to give—and give more money—than self-described “liberals.” In the year 2000, households headed by a conservative gave, on average, 30 percent more dollars to charity than households headed by a liberal. And this discrepancy in monetary donations is not simply an artifact of income differences. On the contrary, liberal families in these data earned an average of 6 percent more per year than conservative families.

So, with that said, let me make it clear that what I describe as policy in no way or manner represents my individual and specific view of the actual person, their plight, human spirit and personal tragedy.

Okay, now, onward.

I caught a Reuters article recently.  Specifically detailing the impact of the recession on our children; our homeless children:

In a report issued earlier this month, the National Center on Family Homelessness, based in Needham, Massachusetts, said 1.6 million children were living on the streets of the United States last year or in shelters, motels and doubled-up with other families.

That marked a 38 percent jump in child homelessness since 2007 and Ellen Bassuk, the center’s president, attributes the increase to fallout from the U.S. recession and a surge in the number of extremely poor households headed by women.

To be sure, we have work to do.  The problems surrounding kids who don’t have hoes is bad.  And getting worse.  I don’t think there’s a soul alive who who disagree that something, anything, has to be done.  But it’s important to acknowledge that the thing, the “anything, is going to come in two forms:

  1. Direct assistance to the displaced families right now.
  2. Actions that will prevent the homeless condition from occurring in the first place.

While noble, I am less interested in the first, as a matter of policy, than I am in the second.  Consider this:

As her mother sat in a homeless shelter in downtown Miami, talking about her economic struggles and loss of faith in the U.S. political system, 3-year-old Aeisha Touray blurted out what sounded like a new slogan for the Occupy Wall Street protest movement.

“How dare you!” the girl said abruptly as she nudged a toy car across a conference room table at the Chapman Partnership shelter in Miami’s tough and predominantly black Overtown neighborhood.

There was no telling what Aeisha was thinking as her 32-year-old mother, Nairkahe Touray, spoke of how she burned through her savings and wound up living in a car with five of her eight children earlier this year.

Think of that.  This woman is trying to care for a family of 9 on her own.  Ms. Touray is 32 years old and has 8 children.  In comparison, I had yet to be married at 32.  And now, as a professional married to another professional I have two children.  Without making any judgements as to decisions or life circumstances, as a 32 year old professional, I’m certain that I would have struggled caring for 8 kids.  Even making it to work would be difficult if not impossible.

Again, my interest in the conditions of the poor and homeless in America are more focused on preventing single 32 year-old women from having 8 children.  To put this in perspective, if you were to take ALL families in 2011, the percent of them that have 7 or more members is 2.6%.  When you look at only female householder, the percentage of families with 6 members is 2.8%.  In a perverse fact of life, the problem gets worse as women find themselves raising the family alone.

Certainly I can’t know the journey that Ms. Touray has taken to get to where she is.  Her life could be one of immeasurable bad luck and unbelievable twists of fate that have led her to where she is.  However, I suggest that another theme exists.  One that we can change.

That is, there is a significant portion of our population that makes misinformed and bad decisions that ted to put them in cohort groupings that lead to poor outcomes.  Is it perfectly allowable that a single woman would want to make it on her own and raise a family of 8 children?  Sure, without a doubt.  However, if a trusted friend or sister were to seek your advice on her decision to embark on this path, what might your counsel look like?  Would you caution her?  Might you recommend that she obtain an education?  Perhaps secure income?

Something.

What would you counsel your own daughter to do?

And if THAT answer is different than, “I’d do nothing.  However, I would continue to lavish untold amounts of mine and my neighbor’s money in order to support her.”, then I ask you:

Why aren’t we making YOUR answer policy?  Why aren’t we telling our Ms. Tourays of the world that it’s generally not accepted wisdom to create a condition where you are single with 8 kids?  In fact, why is it so “insulting and disparaging” even to merely suggest such advice?

A free and open market will settle on the demand for goods or services.  As the government adds requirements to that market, the price will change and adjust to accommodate the new cost of that good or service.  For example, if you wanna house, one can be built for you at such and such a cost.  However, when the requirement, however reasonable, that the house have plumbing is added, the cost of that house is going to go up.

I’m not claiming that we allow houses to be built without plumbing.  I’m simply stating that when we DO make that requirement, we price homes above what some segment of the population can afford.

This is true of all things.  And school lunch is no exception:

It’s lunchtime at Van Nuys High School and students stream into the cafeteria to check out the day’s fare: black bean burgers, tostada salad, fresh pears and other items on a new healthful menu introduced this year by the Los Angeles Unified School District.

But Iraides Renteria and Mayra Gutierrez don’t even bother to line up. Iraides said the school food previously made her throw up, and Mayra calls it “nasty, rotty stuff.”

And why is the school cafeteria serving lunch that students don’t wanna eat?

Earlier this year, the district got rid of chocolate and strawberry milk, chicken nuggets, corn dogs, nachos and other food high in fat, sugar and sodium. Instead, district chefs concocted such healthful alternatives as vegetarian curries and tamales, quinoa salads and pad Thai noodles.

The district, government, tried to regulate the market.  No longer could schools sell food that kids wanted to eat, rather, the school was forced to sell food that the regulators decided was fit for the kids.  Now, do I think that fresh pears and pad Thai is better for you than corn dogs and nachos?  Hell yeah!  In fact, I’ve eaten many many more portions of pears and pad Thai than corn dogs and nachos in the last, what, 20 years.  I fact, I can’t remember the last time I had a corn dog.

Point is, independent of the fact that mandating healthy food is good or not, when the regulation is applied, the market shifts.  It adjusts.

Many of the meals are being rejected en masse. Participation in the school lunch program has dropped by thousands of students. Principals report massive waste, with unopened milk cartons and uneaten entrees being thrown away. Students are ditching lunch, and some say they’re suffering from headaches, stomach pains and even anemia.

Waste.  And unhealthy behavior.

But do you know what ELSE happened?

At many campuses, an underground market for chips, candy, fast-food burgers and other taboo fare is thriving.

The market adjusted and is now providing the very thing the regulations were meant to diminish.

The lesson?

The market will win.

 

 

 

The desire to protect the citizens drives crazy results.  People, intending to “do the right thing” and “protect” the people, get so caught up in that role they never stop and consider the absurdity of what it is they are doing.  The never ending desire to prevent harm is a constricting burden when placed within the hands of those who fail to understand that man is largely able to craft positive outcomes for himself.

And so it is that government has created a condition such that we are unable to hand our free hot dogs to free people:

Tin Cup’s bar and restaurant in St. Paul’s North End will pay a $500 fine to the city for grilling hot dogs outside on Oct. 2 without an event permit.

Co-owner Gidget Bailey appeared before the city council Wednesday to explain that she inquired with a state agency before cooking the hot dogs, which were given away inside the bar at 1220 Rice St. and not sold or consumed outside.

“I did call the Minnesota Department of Health asking if there was anything I needed to do,” Bailey said. “They told me no.”

The city’s Department of Safety and Inspections cited them for not obtaining a “temporary extension of service area” license for the outdoor event, which led to several calls to the District 6 Planning Council. The planning council then informed DSI of the event.

Council Member Lee Helgen reminded the bar owners that they should have known to check with the city.

The council vote to impose the fine was unanimous.

Note one member of the government body felt that the regulations describing the proper offering of hot dogs was so onerous as to prevent the levying of the fine.

 

In the last few days and weeks we’ve been hearing a lot about the payroll tax hike/cut.  Lately the pitch has ramped up for two reasons.  One, the Senate was ale to negotiate a bipartisan agreement to extend the tax cuts.

For 2 months.

Now, most recently, the House Republicans have declined to accept that compromise.  They voted Tuesday to reject the Senate deal and are asking for the two bodies to meet in committee.  We’ll see who blinks.

However, for me, what has been lost in all of this is why the Democrats are fighting for a tax cut to begin with?  I certainly understand the whole “We-They” thing, after all, the whole payroll tax cut idea was the Democrats brain child.  But why, at all, do the tax more, big state liberals want ANY tax cut?  Especially one that funds their most precious social program, Social Security?

Why?  Because Social Security is SO broken, so in debt and so “no chance of survival” that the Democrats feel they have little to lose.  In fact, they KNOW the government will “bail out” Social Security.  So, in some perverse way, the payroll tax cut can be seen to be a stimulus program.  Albeit not a perfect one.  For starters the more you make the more it benefits you.  And, you have to actually be working to benefit.  But other than that, any money not sent to Social Security is just added to the bill that Congress will eventually pay.

Rascally Rabbits!

Most certainly, however, I am sure they are not alone.  But I can’t blame ’em.  Really.  They’re just a victim of the tribalism going on in Washington.

So, specifically, Democrats labelled Paul Ryan’s Medicare plan as one that would “end Medicare as we know it.”  And they defend this statement thusly:

“The very definition of the Medicare program is a national health insurance program for seniors which House Republicans would abolish under their budget,” the Democratic Congressional Campaign Committee said in an earlier rebuttal of Politifact’s analysis of the Ryan plan.

And additionally:

“It seems foolish to have to parse the meaning of the word ‘end,’ but if there’s a program, and it’s replaced with a different program, proponents brought an end to the original program,” liberal blogger Steve Benen wrote at the Washington Monthly. “That’s what the verb means.”

Okay, but the silliness is obvious.  Using this logic any time any program is changed, even by the slightest bit, the old existing plan would “end” and the new plan, complete with all it’s new language, would be the new plan.

Wanna change the test scoring system in public education?  Well, go ahead, but be aware that you are “ending public education as we know it”.

Wanna increase the speed limit on I-40 from 60 to 65?  Okay, but be prepared to defend how you are “ending the federal interstate program as we know it.”

Absurd, truly.

And I am not alone.  Politifact has named the Democrats charge the “Lie of the Year”.

Republicans muscled a budget through the House of Representatives in April that they said would take an important step toward reducing the federal deficit. Introduced by U.S. Rep. Paul Ryan of Wisconsin, the plan kept Medicare intact for people 55 or older, but dramatically changed the program for everyone else by privatizing it and providing government subsidies.

Democrats pounced. Just four days after the party-line vote, the Democratic Congressional Campaign Committee released a Web ad that said seniors will have to pay $12,500 more for health care “because Republicans voted to end Medicare.”

Rep. Steve Israel of New York, head of the DCCC, appeared on cable news shows and declared that Republicans voted to “terminate Medicare.” A Web video from the Agenda Project, a liberal group, said the plan would leave the country “without Medicare” and showed a Ryan look-alike pushing an old woman in a wheelchair off a cliff. And just last month, House Minority Leader Nancy Pelosi sent a fundraising appeal that said: “House Republicans’ vote to end Medicare is a shameful act of betrayal.”

After two years of being pounded by Republicans with often false charges about the 2010 health care law, the Democrats were turning the tables.

PolitiFact debunked the Medicare charge in nine separate fact-checks rated False or Pants on Fire, most often in attacks leveled against Republican House members.

Now, PolitiFact has chosen the Democrats’ claim as the 2011 Lie of the Year.

Go read the whole thing.  There are worse things to do on December 20th.

A long time ago President Bush lowered the marginal federal tax rate.  However, he was only able to do it through reconciliation.  This meant, of course, that they were not permanent; they would have to expire.  Since then we’ve been engaged in class warfare as the Left screams to reset the rate for the richest 1%.  As Republicans work to prevent the tax increase, all the rage from the Democrats was that this wasn’t a tax hike, it was simply allowing the tax to go back to where it previously was.

Now, in an admittedly bizarre twist of fate, we have the Democrats bemoaning the fact if the the House doesn’t pass the most recent tax bill, it would be a tax hike on the middle class:

“The bipartisan compromise passed in the Senate yesterday received 89 votes, including 39 Republican votes, and Speaker Boehner himself just yesterday called it a ‘good deal’ and a ‘victory,’ ” the White House communications director, Dan Pfeiffer, said in a statement.

“If House Republicans refuse to pass this bipartisan bill to extend the payroll tax cut,” Mr. Pfeiffer said, “there will be a significant tax increase on 160 million hard-working Americans in 13 days that would damage the economy and job growth.”

As I mentioned, this is bizarro world and I happen to agree with the Democrats.  If the bill fails and the payroll taxes are reset, it would represent a tax hike on America.

I’m just glad that the Democrats finally agree with me.