Category: free trade & free markets

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free trade & free markets national politics & policies too much government

RomneyScare

As a candidate for the presidency, Mitt Romney has a number of things going for him. He’s rich, handsome, and has a funny first name.

Perhaps more importantly, he’s neither Donald Trump nor Newt Gingrich.

But still, he does have a niggly problem: His experience. He was the Massachusetts governor who signed a medical care reform law that provided the blueprint for the Democrats’ national version, now known (un)popularly as “ObamaCare.”

One of the best reasons to vote “Republican” next year would be to oust the politician who gave us such a bad bill. But, on matters of “health care,” Romney comes off as nothing less than the generic knock-off of Obama.

The Wall Street Journal recently published a critique of Romney’s Massachusetts fix, highlighting its “technocratic” (decidedly not “market-based”) nature, individual mandate, and consequent necessary government mandate to subsidize the uninsurable. Plus, of course, its spectacular lack of cost containment.

The one thing in the reform’s favor is that the ranks of those covered by medical insurance has grown.

But that the state’s pre-reform, utility-like regulation of the insurance industry had priced so many out of the market? That somehow doesn’t get addressed — most certainly not by the program’s defenders or by Romney himself. Or many others. Pity.

Mitt gave a major speech last night, defending his “RomneyCare,” saying that his position “is not going to satisfy everybody.”

How can it satisfy anyone but big-government partisans?

This is Common Sense. I’m Paul Jacob.

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free trade & free markets tax policy

An Attack on Private Pensions

We all know that America’s socialized pension system is, barring major reforms, doomed to undergo major default. But Americans should be nervous about their private pension funds and accounts, too.

Over at PensionTsunami.com, the folks at California Public Policy Center have their ears to the ground, listening for rumblings of the next market collapses, a huge bubble bursting in multiple forms of pension systems. A link from that site led me to a Bloomberg article, about Ireland’s bizarro response to that country’s downturn.

And the ominous portent it presents.

You see, Ireland’s politicians are so convinced that they have to “do something,” something big, to jumpstart the economy out of its current depression, that they’ve decided to levy a tax against pensions — a special tax designed to raise 470 million euros a year for four years, to pay for a massive new jobs program.

Forget that government jobs programs rarely do much good. Forget that it’s not government investment which accounts for market progress, but private investment, and that people will invest when they feel secure enough about the future to do so.

Forget that robbing people of their savings for the future tends to make investors less secure, less likely to invest — and thus put the economy in a bigger, longer-run fix.

Remember, instead, that to a politician nothing is sacred, nothing is out of bounds for a tax or control.

And that this kind of dangerous public thievery could happen here.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets national politics & policies too much government

Free Markets: Poison or Cure?

Most foes of Obamacare support reform, but reform that liberalizes, rather than further burdening, the health care industry. Individuals have a right to liberty, and free markets prove inherently better than rule-bound bureaucracies at providing goods and services. Yes, even medicine.

At least one health-care commissar admits this superiority . . . but then promptly suppresses that knowledge.

Donald Berwick, President Obama’s Medicare czar, opines in the Wall Street Journal that the “right way” to bring down health care costs is by improving health care.

“Computers, cars, TVs and telephones today do more than they ever have, and the cost of these products has consistently dropped,” says Berwick. “The companies that make computers and microwaves didn’t get there by cutting what they offer: They achieved success by making their products better and more efficient.”

They did, eh? And did profit incentives, competition, and the coordinating functions of prices that are characteristic of market processes have anything to do with it? Are the firms that sell these improved products mere departments of the government — or profit-seeking companies obliged to satisfy consumers or go out of business?

Berwick points to one of the least subsidized and regulated sectors of modern life, and yet the idea of a freer market for health-care products and services doesn’t occur to him. The key to emulating freer, more successful industries, he burbles, is to further hamper an already hobbled medical market.

It’s like saying we’ll cure a guy with pneumonia by also giving him emphysema.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets national politics & policies

Competition Works Even With Limited Info

Few of us understand all our options when we shop for homeowners’ insurance.

The New York Times’s Paul Krugman riffed on this, arguing that “When people call for ‘consumer choice’ in health care, what this mainly comes down to isn’t comparison shopping on actual care . . . but rather comparison shopping on insurance policies. And that’s basically impossible even for home insurance, which is a lot simpler than medical insurance.”

Krugman calls a free market in medical insurance “fantasy.”

Yet the illusions involved in buying insurance also apply to non-market medical coverage.

Consider: Most people with low-price insurance like their coverage at least so long as they don’t have to make many claims against it. That’s because insurance is one of those things you buy hoping not to have an occasion to require it.

Something similar happens in single-payer medicine. Some Europeans (especially the young and healthy) praise their state systems that cost them next to nothing out of pocket, patching up their scrapes, mending their bones “for free.”

But wait till they are old and really sick, and on a multiple-month waiting list for an MRI or cancer treatment. Rationing-by-waiting can be a killer.

Bottom-line this: In a competitive insurance market, on learning of poor performance by your carrier, you can drop your insurer like a hot potato. In single-payer systems, you’re stuck. In line. Hoping not to get something too taxing on the system.

But you do have a choice in coffins.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets media and media people national politics & policies

What’s Going Up

When it comes to government policy and the politics that supports it, why people advocate what they advocate can get complicated.

It’s obvious that people don’t always vote their wallets, their narrowly perceived “self interest.” But it’s just as obvious that even the biggest advocates of “sacrifice” and “public spirit” often come off as greedy and narrowly pandering to at least some interests.

And then there’s the issue of fuel to throw on the fire of ideology.

Gasoline, especially, leads to some bizarre expressions of opinion.

When gas prices rise, people talk “conspiracy.” Chris Cuomo makes the case that “speculators” drive fuel prices up — though I notice that neither he nor his guest seemed much inclined to use actual economic analysis to explain anything. “The facts” Cuomo makes much of are embarrassingly superficial.

Two U.S. senators now push for regulators to “apply the breaks” on speculators. Current prices are, as one of them puts it, “unwarranted.”

In past decades, I remember some prominent politicians talk about adding huge taxes to gas, “just like in Europe,” to discourage consumption and “encourage green energy” and thereby “save the planet.”

I don’t hear those notions often, anymore. Could it be that none of us wants to pay more, so when gas prices rise, we forget our ideologies and other fine notions and just yearn (or scream) for cheaper gas?

Not exactly a rational attitude towards policy. But maybe not that mysterious, either.

This is Common Sense. I’m Paul Jacob.

Categories
folly free trade & free markets

Expensive Cheap Energy

What is “green” energy?

There are two types. First, there’s photosynthesis.

Green plants sustain themselves through photosynthesis, creating energy for their own growth from the light of the sun. We harvest that energy pretty efficiently, with a reaper after most of the hard work has already been done. The sun is a great partner in this cost-effective form of “green” energy, as are carbon dioxide, water, soil minerals and harvesting equipment.

Then you’ve got your feel-good, ideologically motivated “green” energy, which needn’t be cost-effective at all! No matter how expensive creating this energy might actually be, the only thing that counts is whether participants in the process can declare that they are “saving the environment.” What difference, then, does it make whether far more money, and energy, is lost than gained thereby?

Such seems to be the notion behind the University of North Texas’s decision to install 36 “elliptical” exercise machines to turn the school into what the manufacturer, ReRev, calls “the largest human power plant in the world.”

The machines reportedly cost the school $20,000 and presumably required energy to build, pack, ship. But the machines also convert energy exerted during exercise to electricity at the rate of one kilowatt-hour every two days. A kilowatt-hour costs on average about ten cents in the North Texas area. So the cycling produces less than a penny of energy per hour.

But hey, at least it’s a workout.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets national politics & policies too much government

America’s Dirty Nuclear Secret

Before Cherynobl, we could sort of dismiss nuclear power’s danger. Afterwards, we could still say “Well, that’s the Soviets, for you.”

Now, with the ongoing Fukushima Dai-ichi disaster, the extent of what can go wrong is becoming horrifically clear, especially now that it looks like merely gaining control of the worst-off reactor could take months, not days.

It rightly makes us worry about the whole industry.

It’s a pity, too, because nuclear power concentrates its costs (spent fuel in containers) while providing enormous marketable benefits. Burning coal, on the other hand, disperses its “costs” in the form of pollution. Nuclear power would seem to be a perfect market solution.

But a “meltdown” — or just losing control of a fission process — concentrates harms in a manner hard to ignore or justify.

We hear that new nuclear tech is in development, and might become quite safe. But the promised extra-safe variety is not yet online anywhere, yet.

Why?

Could it be because government protects the currently unsafe technology? America’s nuclear power is protected from the rigors of risk as assessed by the cold, calculating insurance industry under 1957’s Price-Anderson Nuclear Industries Indemnity Act, which shifts risk from investors to taxpayers in case of catastrophe.

Perhaps if that were repealed, better nuclear tech would emerge faster.

As it is, our old nuclear tech awaits a rare convergence of disastrous factors, like a major earthquake plus human error, or terrorism plus x.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets general freedom

Locavore Focus

As the federal government goes on a spending binge, continuing to tread heavily on the American people —

As the state governments, too, carry on the federal government’s wayward tradition —

As even county and metro governments get out of hand —

Perhaps it’s time to shore up truly local government, which might be a bit more concerned with personal freedom and individual responsibility.

And perhaps Sedgwick, Maine, is as good a place to start as any.

On the first Saturday in March, the folks assembled in the town meeting considered and passed a “Food Sovereignty” law. Designed to oust state and federal busybodies who prohibit farmers from selling whole, raw milk to neighbors, the ordinance states that the townsfolk “have the right to produce, process, sell, purchase and consume local foods thus promoting self-reliance, the preservation of family farms, and local food traditions.” Soon after, the Penobscot township passed a similar ordinance, but the notion failed in Brooksville.

Basically, these are attempts by townships to nullify federal and state regulation. It’s worth remembering such ideas are not exactly unheard of.

Thomas Jefferson advocated state nullification of laws — and historian Tom Woods has recently written a very popular book on the subject. The great Austrian economist Ludwig von Mises went further, thinking that liberalism (old-fashioned believing-in-liberty liberalism) entailed the right of secession down to the local level.

So it’s not just locavores and food puritans rejoicing over the victories in Maine. Freedom-lovers can rejoice, too!

This is Common Sense. I’m Paul Jacob.

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folly free trade & free markets national politics & policies Tenth Amendment federalism too much government

Derailing Washington’s Train Fixation

The great age of trains — the 19th century — spawned a few amazing political careers, not excluding the railway lawyer, Abraham Lincoln. Many major railroads depended on moving politicians first, earth and iron second.

More than ever, today’s passenger rail lines are creatures of the state. Amtrak loses money, and could only be successful as a private operation were politicians able to let its unprofitable lines go.

Congress insists, instead, on putting up more money-losing railways in as many places as possible. President Obama even tried to get a bullet train put through between Tampa and Orlando, despite the fact that the two Florida cities were too close to each other for a super-fast train to make any sense.

Worse for the bullet was the politics.

In 2000, Floridians had voted in high-speed monorail; in 2004, they voted in greater numbers to kill their own project. Voters realized that, with politicians in charge, railroad projects tended to go runaway.

Perhaps that helped convince Rick Scott, the new governor, to reject the federal government’s offer to pay $2.4 billion of a $2.6 billion bullet train. The billions of “free money” that the Obama Administration promised began to seem, well, costly.

So, of course, the federal government sued. In early March, a Florida court ruled that the governor did indeed have the power to tell the feds to play with trains elsewhere.

A minor victory for railway sanity. A major victory for federalism.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets too much government

National Public Railroadeo

The controversy about all the elitist condescension galloping through the halls and programming policies of National Public Radio are both on point and beside the point. Even if NPR’s appeal were universal, it is not the proper function of government to be funding and controlling media.

Just the same, NPR’s appeal is far from universal. It serves not “the public,” but a slice of it — about 11 percent, according to Sue Schardt, member of an NPR distribution committee. She concedes that those who built NPR “unwittingly cultivated a core audience that is predominantly white, liberal, highly educated, elite” but stipulates that it was “never anyone’s intention to exclude anyone.”

True, but not meaningful. Coca Cola would love to get all the Pepsi people, Mother Jones would love to get all the National Review people, plus Esquire and New Yorker people, plus CBS and NBC and ABC people. But every successful enterprise must target its product.

Schardt believes that the way to answer political challenges to NPR’s funding is to expand the base with a broader appeal. The 30-year incubation period is over, now let’s be all we can be! Prove the nay-sayers wrong!

Fine with me if NPR tries this — or any other audience-building strategy. Just not on my dime. NPR would probably do best preaching to the liberal choir as they’ve always done. But, again, in the marketplace. Don’t make the rest of us pay for it.

This is Common Sense. I’m Paul Jacob.