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Berating Bernie?

Bernie Sanders, Glass Steagall, ratings, agency, Common Sense, illustration, Paul Jacob, James Gill

Bernie Sanders has risen in the polls. He may even beat Hillary Clinton in the first caucus and primary contests for the Democratic presidential nomination.

A cause for celebration! Witnessing a huge hunk of Americans accept Mrs. Clinton, the consummate and corrupt insider, is too disheartening.

Bernie Sanders, for all his faults, is at least not an insider like Hillary.

And even when he’s obviously wrong, he’s a breath of fresh atmosphere. Take his recent call for turning the credit ratings institutions into non-profits, or into government-run bureaus. It’s good to hear someone on the left blame something other than the partial repeal of Glass-Steagall as the cause of the Crash of 2008, and (thus?) of the current “Great Recession.” Glass-Steagall was utterly irrelevant to the institutions that were hit hardest in 2008’s collapse; it has, nevertheless, served as leftists’ idée fixe for years now. Embarrassing.

The ratings agencies, on the other hand, did play a part in the crash.

Still, remember: their prominence and importance (and very existence) in financial sectors rests entirely upon one provision of FDR’s New Deal.

More importantly, Bernie’s favored solution — government bureaus — is no solution at all. Europe’s ratings system failed in 2008, too, as Mark A. Calabria has noted, and “it was the international financial regulators, not the rating agencies, who decided that Greek debt was ‘risk-free.’”

Earth to Bernie: government regulatory failure is normal.

Calabria agrees that we need to have a political conversation about the ratings agencies, but insists it be “based on facts,” not ideology.

I’m all for the facts, but ideologies are inevitable. And ideologies promoting Big Government inevitably fail.

This is Common Sense. I’m Paul Jacob.

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Accountability folly ideological culture moral hazard nannyism national politics & policies too much government

Bernie’s Bogus “Medicare for All”

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Bernie Sanders promises universal health care, but, up until the other day, just waved his hands in the air, without specifics. Now he has a plan.

Sort of.

Ezra Klein, writing at Vox, says Sanders’s “Medicare for All” is not a plan at all. It’s a “gesture towards a future plan.”

But that doesn’t mean that the thing isn’t “well sold.”

After praising the Obamacare/Affordable Health Care Act for giving “health insurance” to more than 17 million people, the preamble of Sanders’s proposal made its most predictable statement: “Twenty-nine million Americans today still do not have health insurance and millions more are underinsured and cannot afford the high copayments and deductibles charged by private health insurance companies that put profits before people.”

Forget that deductibles are integral to the very idea of insurance. Forget that profits are absolutely necessary for the success of an industry. Forget that profits come from serving people.

Remember, instead, the leftist clichés.

Sanders’s plan, such as it is, is a lie — or, in Klein’s phrasing, “has nothing to do with Medicare.” Sanders aims to get rid of deductibles and copays, on which Medicare depends. It’s what makes Medicare distinct from, say, socialized medicine.

Insurance covers individually unforeseeable but actuarially manageable risks. Socialized medicine gets rid of the idea of “payment for service” on every level — and thus the very idea of insurance — and turns the whole thing over into a tax-and-spend program, i.e., what Sanders really wants.

That won’t be cheap, as Megan McArdle demonstrated some time back during the Vermont “single payer” kerfuffle.

The only option for increasing value while lowering prices? Go the opposite direction from socialism.

This is Common Sense. I’m Paul Jacob.

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Accountability folly ideological culture media and media people national politics & policies

Shameless: The Next Generation

Chelsea Clinton, Hillary Clinton, President, Bernie Sanders, Health Care, mud, Common Sense, attack

On Tuesday, former (and perhaps soon to be again) First Daughter Chelsea Clinton attacked Vermont Sen. Bernie Sanders, her mother’s chief rival in the presidential primaries.

“Sen. Sanders wants to dismantle Obamacare, dismantle the [Children’s Health Insurance Program], dismantle Medicare, dismantle private insurance,” Chelsea charged, telling an Iowa audience that he “would strip millions and millions and millions of people off their health insurance.”

The Sanders campaign quickly fired back that the young Clinton was “wrong” and disingenuously ignoring the fact that Sanders would bestow government-paid healthcare coverage on every American. For free! (Unless you happen to pay taxes, that is. Then, it’d be very expensive.)

“It wasn’t an honest attack,” declared Democratic strategist David Axelrod on CNN.

But on ABC, Hillary defended her daughter, doubling-down by arguing, “that’s exactly what he’s proposed. To take everything we currently know as health care, Medicare, Medicaid, the CHIP Program, private insurance, now the Affordable Care Act, and roll it together.”

Strange, in 2008, when Hillary was promoting a single-payer system and Barack Obama took issue, Mrs. Clinton decried “tactics right out of Karl Rove’s playbook,” asking, “Since when do Democrats attack one another on universal healthcare?”

“This is wrong and every Democrat should be outraged,” the 2008 Hillary declared. “So shame on you, Barack Obama!”

Now it’s Hillary Clinton who knows no shame.

“More striking perhaps,” lamented Mark Halperin, a senior political analyst for MSNBC and Bloomberg News, “was a lack of interest that most of the news world had to [Chelsea’s] remarks.”

Maybe when Clintons “dismantle” the truth, it just isn’t news anymore.

This is Common Sense. I’m Paul Jacob.

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folly general freedom ideological culture media and media people

Nazi by Association

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Do haters of Charles and David Koch, the billionaire philanthropists, know no bounds of decency?

Monday’s New York Times squib, “Father of Koch Brothers Helped Build Nazi Oil Refinery, Book Says,” is a grand case in point. The article is basically pre-release gossip about a book that hasn’t been published yet: Dark Money, by Jane Mayer, a New Yorker writer. The author focuses on the Kochs and other rich folks who, the article says, served as “the hidden and self-interested hands behind the rise and growth of the modern conservative movement.”

As usual with “progressive” minds, she just assumes that all the billionaires and foundations who have supported her causes over the years cannot also (or: better) be described as “self-interested.”

Her main charge, that the Koch brothers’ father had helped build “the third largest oil refinery in the Third Reich, a critical industrial cog in Hitler’s war machine,” is nothing more than guilt by association. As Dave Robertson, President and Chief Operating Officer of Koch Industries, notes in his official response, the plant in question was built before Hitler had proven himself a tyrant. It’s ridiculous to insinuate that the business deal demonstrates that a family of limited government proponents were somehow in favor of the big government tyrant, Adolf Hitler.

Calumny!

But once made, we may return volley.

Partisans often accuse their enemies of their own worst faults. I’m sure Ms. Mayer is not a Nazi, as such, but her economic ideas are a lot closer to the actual policies of the National Socialist Party than are the Kochs’.

Hence her need to smear first.

This is Common Sense. I’m Paul Jacob.

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Accountability folly ideological culture nannyism national politics & policies too much government

Doom in Oil Boom?

Oil, cheap, energy, climate change, global warming, prices, illustration, Common Sense

Tragedy has hit the environmental movement: The price of oil is going down.

And may go down further.

While environmentalists quiver, science writer Ronald Bailey chortles. “Resource depletionists” — the prophets of “peak oil” — should, he says, hide their heads in shame! They’ve been so very, very wrong in the prophecy biz.

As oil descends towards $20 per barrel, we should ask ourselves: where’s the tragedy? Well, it will postpone the switch to non-fossil fuels. The need is far from obvious, and the incentive is to use energy in its cheapest, most efficient forms.

But if increased CO2 in the atmosphere is destabilizing the planet’s atmosphere and ecosystem, cheaper oil (and thus more burning of it) might lead to the much-ballyhooed tragedy for all.

Still, that’s a big “if” — the more we learn about the climate, the more doubtful the identified CO2 causation and attendant doom.

Besides, global warming catastrophism’s implicit message — the “need” for global political control over everybody and everything to “manage” climate changes — seems awfully convenient for those who just love intrusive government . . . on “principle.”

It echoes the Keynesian technocratic conceit in economics — that experts should manage the economy by fiscal methods (increasing debt) and monetary intervention (central bank interest rate manipulation and bad asset purchase). It’s pretty obvious that they shouldn’t, because they’ve demonstrated they can’t.

As prices for oil defy “peak oil” prophets’ predictions, it becomes obvious: the world works differently than dreamed up by the prophets of doom.

This is Common Sense. I’m Paul Jacob.

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crime and punishment folly free trade & free markets general freedom nannyism too much government

Law in the Tooth

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Why did Dr. Ben Burris give up his orthodontic license? Where did he go wrong?

Dr. Burris broke the law. He flagrantly violated the hallowed precepts of the Arkansas Dental Practices Act. Let me rinse and spit out the truth: This dentist illegally cleaned people’s teeth.

Not just once — he did it again and again. Often twice a year per patient — or victim, depending on your viewpoint.

Plus, brace yourself, he didn’t merely scrub their choppers, he did so — get this — at very low cost.

We need strong laws to stop such scoundrels.

That bastion of wisdom, the State of Arkansas, has no qualms about Dr. Burris’s qualifications to remove plaque from our incisors, canines and molars, having licensed him to practice dentistry. The problem is actually that Dr. Burris is over-qualified.

Especially to charge low prices!

Burris got licensed in a specialty: Orthodontia. You see, according to state law, a dentist so licensed “must limit his or her practice to the specialty in which he or she is licensed except in an emergency situation.”

Only after terrorist attacks or earthquakes can society risk allowing Orthodontists to daringly and brazenly polish people’s teeth. For less.

This particular statutory tyranny aims to close healthcare markets, minimize patient choice and keep dental costs artificially high. Luckily, beyond being maliciously wrongheaded, Arkansas’s dental law is absurdly foolish.

Dr. Burris dropped the federal court challenge being litigated by the Institute for Justice. Why? He discovered that by simply relinquishing his orthodontic license, he could legally practice orthodontics and clean people’s teeth at low cost.

He just can’t call himself an Orthodontist — but can call the law an ass.

This is Common Sense. I’m Paul Jacob.

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folly general freedom ideological culture nannyism national politics & policies too much government

“Unacceptable,” He Sputtered

ATM, Bernie Sanders, economics, fallacy, Common Sense, illustration

The King Canute Memorial Award for Clueless Legislation (Winter 2015-16) goes to Senator Bernie Sanders. He had stiff competition from ocean-lowering President Barack Obama, this season, but surely earned it these past few months.

Canute famously warned his advisors that he was no miracle worker. Standing by the sea and commanding the tide to turn only works on a regular schedule — set by natural forces, knowable in advance only after years of careful observation. All the hand-waving, incantations and official edicts cannot change the tide.

The award goes to those most in need of the Full Canute Object Lesson. Sanders’s latest ninnyism begs for just such a lesson: He wants to establish maximum fees for ATMs, down to $2 per transaction.

As everyone knows, some ATMs charge more than others. Why? It is not costless to provide electronic bank inquiries and withdrawals around the country . . . and the world. And profitability varies.

Supply and demand. Entrepreneurs do not offer these services out of charity. Close off profits in some areas, there will be corresponding effects.

From my experience, transaction fees range from about five bucks down to . . . Zero.

I usually pay nothing.

Outlawing fees above some arbitrary maximum will almost certainly ensure there will be fewer ATMs — particularly in low-use areas — and might even raise those zero-priced transactions to one- or two-buck fees.

Prices aren’t arbitrary, so no matter how loudly Bernie Sanders sputters “Unacceptable,” price ceilings aren’t magically going to produce the same service at less cost.

This is Common Sense. I’m Paul Jacob.

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crime and punishment folly free trade & free markets ideological culture national politics & policies too much government

Subsidizing Illegal Aliens

Rand Paul, subsidy, aliens, illegals

In The Mouse That Roared, a 1955 comic novel by Leonard Wibberley, a tiny English-speaking country in Europe loses market share for its only export, a wine label, to a cheap American knock-off. Seeking compensation for the loss, the duchy decides to do the only rational thing: declare war on America, and then, after the inevitable defeat, reap the rewards of reconstruction financing.

I was reminded of the book when reading about another of the Obama Administration’s subsidy programs, uncovered by Sen. Rand Paul. The program gives money to illegal aliens deported to their country of origin, El Salvador, to start small businesses.

Sort of a Small Business Administration program for deportees.

But Congress’s involvement is nil, and the SBA has nothing to do with it, either. The program, according to the Rand Paul press release, “is administered by the non-profit Instituto Salvadorno Del Migrante (INSMI — translated to Institute of Salvadorian Migrants) and funded through a $50,000 grant from the taxpayer-backed Inter-American Foundation.”

It is not big money, certainly not by profligate Washington standards. Nor is the premise of the program likely to win it praise from anyone looking for a solution to illegal immigration. Indeed, the best way to describe the program is how Rand Paul’s team did describe it: “absurd.”

In The Mouse That Roared, the Duchy of Grand Fenwick makes a crucial mistake in its plan to profit from American largesse: it wins the war.

But some things haven’t changed since then. The American government throws around money absurdly.

And little countries make fools of Big America.

This is Common Sense. I’m Paul Jacob.

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Accountability crime and punishment folly general freedom moral hazard national politics & policies U.S. Constitution

Forfeiting Forfeiture

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“The Department of Justice announced [last] week that it’s suspending a controversial program that allows local police departments to keep a large portion of assets seized from citizens under federal law and funnel it into their own coffers,” reports the Washington Post.

The Feds call the paused program “equitable sharing”; as I explained last month, I call it “equitable stealing.”

Even when state and local laws prohibit it, local police have been using this federal program to continue taking people’s money and property without ever convicting them of a crime.

The loophole? They split the loot with the Feds.

Now that has ended. According to the Post, this is the result of “budget cuts” in the recently passed omnibus spending bill; the Wall Street Journal calls it a “reallocation of funds.”

Either way, Happy Holidays!

Yet, sadly, the return to freedom, justice and the American Way may be short-lived.

“The Department does not take this step lightly,” wrote M. Kendall Day, the chief of DOJ’s Asset Forfeiture and Money Laundering Section. “We explored every conceivable option that would have enabled us to preserve some form of meaningful equitable sharing. . . .”

In his letter, he proclaiming a commitment to the principle of guilty-until-proven-innocent and to grabbing people’s stuff, telling state and local and tribal police departments, “We will take all appropriate and necessary measures to minimize the impact of the rescission and reinstate sharing distributions as soon as practical and financially feasible.”

As the Wall Street Journal editorialized, “Congress should make sure that never happens.”

Of course, Congress will likely need a mighty nudge from us.

This is Common Sense. I’m Paul Jacob.

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Accountability folly free trade & free markets general freedom ideological culture moral hazard national politics & policies too much government

Collateral Damage Defines Socialist B.S.

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Senator Bernie Sanders gave us a big present last week. In one simple “tweet” he warbled out the essence of his socialism: “You have families out there paying 6, 8, 10 percent on student debt but you can refinance your homes at 3 percent. What sense is that?”

That’s what he broadcast. That’s what this self-proclaimed socialist wrote — or allowed his staff to write — on his official Twitter account, @SenSanders.

And it is not as if he had the excuse of haste. He was repeating a thought from his presidential campaign account in September: “It makes no sense that students and their parents pay higher interest rates for college than they pay for car loans or housing mortgages.”

To the earlier post, Twitter erupted in criticism. The gist? Have you never heard of collateral, sir?

Lenders can charge less on secured loans because, in case of default, the recourse is to take the collateral, the car or house, thereby recouping the loss.

But an unsecured loan? Well, by law one cannot easily slough off student loans — but one can simply not pay, or pay late. Hence the higher rates.

From its beginnings, socialism — and progressivism and Fabianism and fascism and social democracy, following — has been fueled by complaints about markets.

Without showing any understanding of the logic of markets.

Which is why, when put into practice, socialistic and interventionist programs produce such great amounts of negative collateral effects. Socialism is the philosophy of good intentions that yields collateral damage worse than the problems meant to be solved.

Oh, Bernie Sanders! Your initials say so much.

This is Common Sense. I’m Paul Jacob.

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