Friday, December 18, 2015

Obama Administration Changes Policy on Assad

It comforts me to know that Obama by changing policy with regards to Assad is admitting that I was right all along, and he and Bush were very wrong all along. 

Sometimes I say to myself, you might be wrong the Federal Government administrators mostly got into Yale and Harvard (Yale and Harvard would have laughed at my application had I applied), and they have access to more info than me so maybe I am wrong and they are right, but this change in policy clearly admits that they were wrong and I was right! 

So how can such intelligent people be so obviously wrong and I be right? One theory is that the supper intelligent/great students like that tend to live in a bubble are not realty to common people and so loose touch with reality. 

Perhaps it and Bush's policy in the Middle-eat are the result of cultural and genetic blank slatism run amok. One reason nice people cling to blank slatism is because admission of cultural and genetic group differences could be very bad in the wrong populist hands.

Also Politicians are experts in getting elected not in Governing. 

At least  the Obama administration is showing humility by changing policy. I like Obama personally he seems to be a better person than most politicians and he has shown more military restraint than most presidents which I think is good. I disagree with him on most policy though.

Tuesday, December 8, 2015

The Good Samaritan Again

In the time of Jesus the Samaritans where people who had taken the scriptures that existed at the time and had added four Gods on top of them. Do you know who else took the scriptures and added something on top of it? Mohamed did.

It is as if he said in 2015 USA, a Christian man was traveling to a town and on the road he was robbed and Muslim man came along and bought him clothes and put him up at a hotel. 

At the end of the story Jesus says go and do likewise. I think that he means even those who hate you are your neighbors and should be treated like the good Samaritan treated that man!

We should have sympathy for our Muslim neighbors and try to win them over with our good deeds.

Friday, December 4, 2015

NCAA Schools Collude to Keep Player Compensation Down, They Should Also Limit Coach Compensation

NCAA schools collude to keep player compensation down, they should at least agree to limit coach compensation to something like $300,000/year. 

Where would the coaches go? The NFL and NBA can only use so many coaches and even if the top coaches did go, would it real make college sports less appealing? I think not. 

Also NCAA sports are used by university administrations as marketing to raise the academic standards of the students they accept which increases the prestige of the university which is in the administrators' interest. But what is in it for the taxpayers? Nothing really.

I live in Gainesville FL home of University of Florida but because UF has been successful in this strategy, they were able to reject my son.  He had to go to University of Central Florida which meant that he could not live with us at home. That cost us an extra $50,000 and it weakens family and has other bad effects! 

The school administration would argue that there is a benefit to concentrating the better students together but there is evidence that such claims are false. In fact studies show that students who applied to more prestigious schools and are rejected do just as well as students who go to the prestigious schools. This is evidence that the schools do not matter but rather the ambition, diligence and intelligence if the entering students is what matters.

Everyone in biased we all are including the top administration of our state universities and we are letting them grab money and prestige at the expense of taxpayers.

Thursday, October 1, 2015

Why This Teetotaler is For legalization of All Drugs

I am all for reducing drug use, especially among the the young, but the government does not have the tools. Government is force, but persuasion is what is needed. The use of force against the drug suppliers has wreaked havoc on some Latin American countries. Due mostly to the war on drugs, the level of violence in Mexico and Honduras is almost as high as in Syria. See here.

Pharmaceuticals are more costly than they need to be as a result of the war on drugs. Many patients suffer needlessly because MD's are reluctant to prescribe pain killers. See here

A past coworker of mine shot and killed a man after a bad drug deal. He was a fine young man, but he was addicted to crack. When drugs are illegal, dealers can't report theft, and customers can't report scams. This causes people to take the law into their own hands. When people take the law into their own hands, the law takes them to jail. 

Wednesday, September 30, 2015

On the Necessity of the Welfare State

Scott Sumner has an interesting post on Libertarianism.

Most USAers assume that the welfare state  is more needed and more effective than it really is, and that a huge amount of charity (in fact more than we could ever come close to getting) would be needed to replace it. They may be right that charity would never be enough but I think charity would be much closer to being sufficient than people think.

When progressives assume that the those lowest income cannot affords something they often forget to factor in reduced demand lowering the price.

One example is that in a market for housing with restrictions on building (adding housing units) which we have in most counties, and where housing is subsidized, if you remove the subsidy the landlords will take some of the hit probably most of the hit.

Another example is that as far as I can tell, even adjusted for inflation, our USA schools spent 3x as much as in the 1960's and output is not much improved. Now I am sure that the experience for the student is better now but I would bet that you could cut spending hugely and get pretty much the same output. And if parents payed directly you could possibly get better output due to motivation and for some other plausible reasons. See the link in Scott's post on this.

Welfare also seems to not make as  much difference compared to what most people would expect. Take Social Security, our biggest welfare program, we only need it for low savers who are to weak to work who have not family or friends to care for them. That is a small percent of the population but to reach that small percent of the population without creating very bad incentives we have to give SS to everyone. A huge cost relative to the problem. BTW I think we should give every USA citizen over 67 $200/week from SS, reducing the program cost by about 1/3rd. BTW I think absent SS most people would start to save as much as possible at about 60 years old and work as long as they could and do OK.

Narrator: One of his greatest ambitions was to persuade the government to start building better roads. He convinced the leaders of the automotive industry to jump-start the process by financing the first paved road across the country -- the Lincoln Highway, from New York to San Francisco. It was such a success that he went on to build another road -- the Dixie Highway... leading, very conveniently, from Indianapolis to the foot of the bridge he was paying for back in Florida.

Thursday, August 27, 2015

Forgetting the History of Central banks

Forgetting that the great depression occurred after the creation of the federal reserve.
Forgetting that Canada avoided the great depression because it had no central bank.
From Wikipedia: In 1934, with only ten chartered banks still issuing notes, the Bank of Canada was founded and began issuing notes in denominations of $1, $2, $5, $10, $20, $25, $50, $100, $500 and $1000. In 1944, the chartered banks were prohibited from issuing their own currency, with the Royal Bank of Canada and the Bank of Montreal among the last to issue notes. From that point forward, the Bank of Canada has been the sole issuer of bank notes denominated in Canadian dollars. A liability of more than $12 million remains on the Bank of Canada's books up to the present day, representing the face value of Dominion of Canada, provincial, and chartered bank notes still outstanding.[3]

Forgetting that wealth would have been greater had the western world not experienced a great depression..

The EU looked at the world and saw the dominance of the US dollar. They saw research that I have seen shows that the USA is 3% richer than it would be if the dollar was not the dominate currency in the word. They wanted a piece of that. They also thought that a common currency guided by an enlightened central bank.would be better for the Southern countries which had been prone to periods of inflation. Further that a single currency would facilitate trade within the EU. And so the Euro was created.

But big currencies mean big problems and we have Greece, Portugal, Spain and Italy with very high unemployment for 5 years! They are all struggling and falling deeper in debt. 

And lest you get the wrong idea even Germany's real growth has been poor. And no one sees an easy way out.

Time to start thinking of smooth way out of the Euro mess.

Great Depression and the Origins of the Welfare state in the USA

Mike Konczal on the origins of the modern welfare state in America:

Informal networks of local support, from churches to ethnic affiliations, were all overrun in the Great Depression. Ethnic benefit societies, building and loan associations, fraternal insurance policies, bank accounts, and credit arrangements all had major failure rates. All of the fraternal insurance societies that had served as anchors of their communities in the 1920s either collapsed or had to pull back on their services due to high demand and dwindling resources. Beyond the fact that insurance wasn’t available, this had major implications for spending, as moneylending as well as benefits for sickness and injuries were reduced.
The Hoover Administration’s initial response to the Great Depression was to supplement private aid without creating the type of permanent public social insurance programs that would arise in the New Deal. Hoover’s goal was to maintain, in the words of the historian Ellis Hawley, a “nonstatist alternative to atomistic individualism, the romantic images of voluntarism as more truly democratic than any government action, and the optimistic assessments of the private sector’s capacity for beneficial governmental action.” As President Hoover said in 1931, much like conservatives do today, any response to the economic crisis must “maintain the spirit of charity and mutual self-help through voluntary giving” in order for him to support it.
Noble as that goal may be, it failed. The more Hoover leaned on private agencies, the more resistance he found. Private firms and industry did not want to play the role that the government assigned them, and even those that did found it difficult, if not impossible, to carry out those responsibilities. The Red Cross, for instance, did not want to move beyond providing disaster relief. Other groups, like the Association of Community Chests and Councils, had no interest in trying to coordinate funds at a national, rather than local, level. Hoover understood that private charity wasn’t getting to rural areas, yet private charities couldn’t be convinced to meet these needs.
What’s most worth noting is that, in the end, both beneficiaries of fraternal societies and private charities themselves welcomed this transition. During the Great Depression, citizens, especially the range of white ethnic communities in the largest cities, watched as mass unemployment tore down institution after institution. From fraternal societies to banks to charities, the web of private institutions was no match for the Great Depression.
As documented in Lizabeth Cohen’s Making a New Deal, these white ethnic communities turned to the New Deal to provide the baseline of security that their voluntary societies were unable to offer during a deep recession. As a result of the implosion of the voluntary societies they depended upon, working-class families looked to the government and unions for protections against unstable banks and the risks of the Four Horsemen.

So if he is correct, it looks to me like the Great Depression was the result of a failure of the Federal Reserve so great that it proved to be too great a burden non-Government charity and so Government stepped in. Of course the the Federal Reserve was created to because of earlier failures of the federal government money system.  That system was created to fund the civil war. So government money was both the cause of the failure and reason that government could afford to step in an help.

Never the less, I think that the big flaw in Government charity is not that it helps the poor creating disincentive to work, but that most of the spending goes to rich and middle class (through SS, medicare, farm and other subsidies and Government schooling) and so Federal Government spending on charity is much higher than it should/could be. My reason to believe that is because I do not think it is possible at this time for Government to subsidize the median life time earner. So you are taxing the same people you spend the money on. 

So absent if the Great Depression was avoided how much of Government do you think would be devoted to charity? I think it would be much smaller and just about everyone would be better off. 

Take Social Security for one example. 
  • a person who earns $15,000/year will pay $82,000 in payroll taxes (employer and employee combined) over 44 years of work. When he retires, his annual benefit will be $10,476 or 13% of his lifetime payroll taxes.
  • a person who earns $50,000/year will pay $273,000 in payroll taxes over 44 years of work. When she retires, her annual benefit will be $21,672 or 8% of her lifetime payroll taxes.
  • a person who earns $115,000/year will pay $627,000 in payroll taxes over 44 years of work. When he retires, his annual benefit will be $32,952/year or 5% of his lifetime payroll taxes.[56]
From Social Security Just the facts 

$1,294 is the average benefit/worker/month. If everyone got what those who earns $15,000/year that would enable cut the program by about 1/3. We could then lower the tax by about 25% allowing workers to spend that money when they want. Most people are poorer when they are young than old and so would get a higher marginal benefit from keeping that 25% than getting 25% more in retirement. The lower earners would not be hurt because many of them would get more than they get now.  Almost all USA citizens would be better off.

BTW In Australia the government part of the retiree pension pays out the same amount to all recipients. 

Bottom line we should not work to end Government charity but we should work to educate people about why Gov. charity should be for bottom percentiles of life time earners.

Friday, July 24, 2015

Amazing Good News

The following Quote is from here.
So instead of global famine, food production tripled even as world population doubled. As a result, the amount of daily calories per capita rose from 2,400 in 1960 to nearly 3,000 today.

I have a  friend who is a PHD agronomist from Brazil, he tells me that beef production per acre in Brazil would 6x higher if the average rancher used the practices of the best ranchers. So we have plenty more to go see below.
Researchers at Rockefeller University counter that—because the backlog of productivity enhancing technologies—humanity is on the verge of “peak farmland” and that by 2060 farmers will have returned an area 10 times the size of Iowa to nature, and even more if governments stop subsidizing biofuels.
The surge in food prices also occurred because huge amounts are being diverted into biofuels. Bourne notes that the International Food Policy Research Institute calculated that biofuel production drove up food prices by 40 to 70 percent. The calories in the 40 percent of the U.S. corn crop that is used to produce biofuel would be enough to feed everyone in Africa for a year. In addition, reducing the third of food that is discarded, spoiled, or eaten by pests would increase supplies by nearly 50 percent.

One other often ignored thing, if you look at the chart here, you will see that some lesser used crops like sweet potatoes yield much more per acre than wheat, corn and rice. I have read that tree crops have even greater yields per acre than potatoes. 

Then there is new technology. A 50% increase in wheat yields is at least theoretically possible. 

Tuesday, July 21, 2015

Illness and Bankruptsy

People can easily be bankrupted in the USA due to an illness. Surprisingly to some, people in countries with socialized medicine can also easily be bankrupted due to an illness. Being bankrupt in not necessarily poverty.
Almost no one in the USA lives in poverty today (mostly only the mentally ill homeless still live in poverty and they exist all over the world and are a very though case.) So if the illness is not mental illness, it will not generally drive a person into poverty in any developed country, not even the USA.
If you can go back to working after the illness you can recover from bankruptcy, most will.  In the USA if you cannot go back to working you will be able to get on medicaid and SS disability. If medicaid and SS disability did not exist things would different enough that it is hard to imagine how people would get by but I would bet that they would. 
The trick with all this is to help the needy while maintaining good incentives to produce. Could we be more charitable, yes but we could also be much more efficient in our charity.

Monday, July 20, 2015

Some Thoughts on the Minimum Wage

To me, the minimum wage looks like a very clever way for politicians to hide a tax that redistributes some money to some low wage employees. 

Who it might hurt:

  • A small number of would be low wage workers who will have no idea that the minimum wage is to blame.
  • Some marginal businesses that now pay below the minimum wage who might go bankrupt quicker.
  • Consumers who buy from those businesses. 

Only the few businesses hurt will know what hit them and they account for very few votes. From the perspective of politicians, it is a brilliant, though on might say unethical, scheme. They get to look like the good guys and companies that provide work for employees who cannot find better jobs look bad.

Who it might help:

  • Shy mostly young people working very hard for very low pay who are to shy to ask for a raise. I think that I was once in that group. 
  • Businesses that pay more than the proposed new minimum that compete businesses that pay the less than new minimum.
  • Those employees who are marginal but will keep their jobs.
  • Businesses like McDonald's and Walmart who can easily pay the higher wages but do not who compete with business that may not be able to afford the new minim wage.
  • Businesses like McDonald's and Walmart that compete for employees with business that already pay more that the new minim wage.

Some facts:

  1. Many people already work for less that minimum wage. If you believe Steven D. Levitt some of those are low level drug sellers. Some work for companies like the one a few offices over from mine called Vector Marketing.  I think in the likes of Vector Marketing most people who end up working for them pay to work. Some work scavenging for metals. A few work for cash. 

  2. Also there always some restaurants teetering on the edge of bankruptcy will a higher minimum wage not push them over the edge a little quicker?

  3. There are large regional differences in cost of living. Some of these are because of differences in real-estate costs but also due to life style.

Much depends on how you feel about the trade off between more money for some workers and less jobs and who should pay for any added expense and also how you feel about hidden taxes. 

I think many on the side of the $15/hour minimum wage believe that it is immoral pay someone so little and so are not bothered if it would drive a few small usually poorly run businesses into bankruptcy. They also have little sympathy for those who buy from low paying businesses, besides it allows them to hit McDonald's and Walmart and they can easily afford the higher wages and can most of their customers.

Monday, July 13, 2015

Government Pensions

This from Dean Baker
In fact, the main reason that some public sector funds face severe shortfalls is that politicians like Richard M. Daley and Chris Christie chose not to make required contributions.
Politicians have an incentive to over promise and under fund pensions.  (Just like the auto company executives.) So each individual should try to make the best arrangements he can and get as much money as he can now. Pensions can be a little like pie in the sky. Pay off your mortgage, add insulation and any home capital that pays back. Work as long as you can keep relations with friends and family strong. Diversify.

Thursday, July 2, 2015

Why the Greek People May Vote to Stay in the Euro

So after it has inflicted so much damage on the Greek economy, why might the Greek people vote to stay in the Euro. 

This is from the comments on this Marginal Revolution blog post by Peter Schaeffer.

There are, in fact, any number of pro-Euro factions many of which are anti-austerity. Some folks (a large faction) favor the Euro because they want their pensions, paychecks, and other handouts in Euros, not Drachmas. These folks are very opposed to austerity, but even more opposed to receiving Drachmas from the government. These folks hate the Troika, love Syriza, but will vote yes anyway.Another faction is comprised of Greeks with bank accounts. A no vote means either banks accounts will be confiscated or converted into Drachmas. These folks may or may not like Syriza or austerity, but at this point fear is the only issue on the table.Yet another faction is made up of basically conservative folks like the restaurant owner. These folks see the Euro as a tool for forcing the Greek government to reform. I don’t think they are in correct in this matter. However, it is their opinion, not the correctness of their opinion, that matters.Still another faction (center / left) sees the Euro as a symbol of Northern European efficiency, a large and well funded welfare state, effective and progressive taxes, modernity, the “tolerance” agenda, etc. Of course, they also see the Euro as means of bringing Greece up to the standard of Denmark of the Netherlands. I don’t think they are in correct in this matter. However, it is their opinion, not the correctness of their opinion, that matters.As you can see, lots of groups support the Euro for reasons that are highly divergent and in some cases contradictory. Some of these folks strongly oppose austerity. Others overtly favor austerity. They will all vote yes anyways.Finally, let me offer a quote from a Greek citizen that sums up the situation all too well.“The EU can’t afford to let us fail so we should continue to say no and they will blink and give us a better deal.”This person intends to vote no. However, plenty of folks will vote yes precisely because they think that yes means more goodies from Europe. In one respect, the advocates of yes are probably very correct. A yes vote will probably be followed by a reopening of Greece’s banks. That’s one last chance to “take the money and run”.
One other factor might be that in a country like Greece where people are more likely to ignore laws, the real rate of unemployment might be way below the reported 25%.

Wednesday, July 1, 2015

It is Hard to Measure What Reduces CO2 More - So do not say "Please scam me" to Politicians

"Researchers find Nissan LEAF creates less CO2 than Toyota Prius hybrid in west US and Texas, but more in N. Midwest"

Regionally specific lifecycle CO2 emissions per mile traveled for plug-in hybrid electric vehicles (PHEVs) and battery electric vehicles (BEVs) in the US can vary widely based on grid emission factors (i.e., the “carbon footprint” of electricity production and use), according to a new study by researchers at Carnegie Mellon University. Under some conditions, the battery electric Nissan LEAF can produce higher emissions than a Toyota Prius hybrid. The paper is published in the ACS journal Environmental Science & Technology."
The team characterized the vehicle emissions across the United States under alternative assumptions for regional electricity emission factors, regional boundaries, and charging schemes. Among the findings were that:"
It is very difficult to tell which method reduces CO2 the most per dollar. So if you go along with  subsidies to green tech beyond basic research and/or cap and trade you telling your congressman "Please scam me."

Good News on Milk Production

From here

One of the keys to higher production and higher profits is to increase the milk yield while raising fewer cows. Between 1950 and 2000, the number of dairy cows in the United States fell by more than half, yet during that same period, the average annual milk yield more than tripled. What made this possible, and how has it affected the welfare of the animals?
Wow that is some serious productivity growth and from what my Agronomist friends their is still a lot of gains to made by bringing the lower producers up to the best producers. That is without new breeds or new technology.

Monday, June 22, 2015

Could the Income Tax be Turned into a a Progressive Consumption for all but but Some of the Top 1%

Could the income tax be turned into a a progressive consumption tax for all but some of the top 1%?  I think it could, by allowing Americans to contribute up to $5 million lifetime before taxes to an IRA. Withdrawals would be allowed at any age and would be taxed as income. You would also want to raise the rates a bit and eliminate the corporate tax, the corporate tax being a tax on saving and investing.

This would greatly simplify my tax return!

Little Gov. Spending Goes to the Important Stuff

Francis Woolley  has a written a paper titled "Why public goods are a pedagogical bad".

The interesting thing to me is how small a part of the budget things most of think as the core function of government are. 

  • All of transportation spending (including roads and bridges) 3%.
  • Police courts and incarceration 5%. 
  • National defense about 6% (the USA is much higher here which BTW is silly. The USA would no less safe spending half that).
  • Basic research less than 1% 

What is left are welfare programs but do not get the wrong idea, little of that is welfare for the poor. It is mostly welfare for the rich and middle class including Social Security, Medicare and schooling. Now this would not be a problem except that people usually spend there money much more efficiently than Government spends there money for them.

Tuesday, June 2, 2015

RICARDO HAUSMANN On "The Education Myth"

 On:  The Education Myth

It should probably be titled The schooling myth?
My grandfather came to the USA from Italy in his mid teens with 1 year of schooling. He eventually owned a barber shop and some real-estate and sent his son to Brown University. He would call certain people “male educato” which meant some thing different than in what it means in English and something that seems far more important to me. It does not mean that you did not go to the right schools. he in fact I think he seemed more educated that many college grads.

Bill commented:

Let’s have a controlled experiment for Hausmann’s hypothesis.We will take half of his children, and let them go to college,And, the other half will stop at high school.Would he take the challenge?
But you really need 4 groups. 

All must be students projected to graduate college easily.

Group 1 Goes right to work without a degree after high school and starts earning.
Group 2 Gets a degree right out of high school and goes right work after high school and starts earning.
Group 3 Goes to college and get degree but must hide that fact and live as if they have no degree.
Group 4 Goes to college get degrees and then to work.

Wait a long time and compare life time earnings.

Who would you bet does best from those 4 groups?

I think school helps people get to where they can read, write and do arithmetic and those skills are important to most everyone. A little algebra probably helps to. I think that the rest can be learned outside of school. My grand father evidently learned enough in one grade to continue to learn without more schooling but I would guess that somewhere between 3 to 6 years of schooling would yield enough school learning for most people. For scientists and engineers much more school probably benefits.

One could also argue that more schooling helps society to not miss as many late maturers. That is it might be difficult to see which 12 years should get the more schooling to become the scientists and engineers. So we might reap a benefit yet from our long period of schooling.

Monday, May 11, 2015

The Worst Teacher I Had

The worst teacher that I had was my junior high school science teacher. He would just stand their and yell while the students ran wild AND he was also my mothers worst teacher 30 years earlier! The poor guy went through that everyday for at least 30 years!

I was still very good in science (relative to my abilities in other classes) and I got A's in science even the year after I had him. 

To me teachers and school seem much less important that we assume that they are. See the work of Bryan Caplan.

BTW One of the other bad teachers that I had my mother had also had. She was bad in that she spent half the day in the teachers lounge but the students feared her so their was not much chaos. 

Wednesday, April 1, 2015

Aaron Carroll on Underinsurance

Aaron Carroll has yotube vidieo discussing under insurance called 

His premise is that people need lower deductibles because they are forgoing car that they should get 
I disagree people may need time to adjust to paying out of pocket for healthcare. It takes time for people to adjust to changes like getting higher deductible insurance.

I think very high deductibles are good for most people. I for years before the PPACA had a $10,000 deductible (I would have gotten a higher deductible if once had been offered) and worked out well for me even though my income was not high and in that period my wife had bearst cancer and we paid the full $10,000 plus some expanses not cover. Most people can easily save for or get a loan to cover $10,000. Once people start hearing of others paying big out of pocket bills they will get prepared. People often pay more than $10,000 for a car. 

To address some of the comments on the post that ask why we cannot have single payer healthcare:

It might be good if we could have a cut down, evidence based medicine only program (medicaid for all) available to everyone, paid for though taxes and anyone who wants more can get private care, similar to what they have in the UK. Evidence based medicine only would probably be so cheap that Government could cover everyone for less than the cost of medicare. But our politicians are very corrupt and so I do not see anything like that happening. So the PPACA is OK for now but could be made better by: 

  1. Allowing bigger deductibles up to $30k for above median income folks. 
  2. Get rid of the employer mandates. 
  3. Stop making it cover cheap things like birth control. 
  4. Smooth the subsidies so it longer contributes to very high marginal tax rates. 

Keep in mind people are not all so honest and upright and will abuse a too generous system. For an example the Amish, who do not carry health insurance often go to Mexico for care and get good care from network of known providers for a 1/0th the price we pa here, but even folks in south Texas will not go over the border to save their fellow Texas tens for thousands of dollar if they have insurance with low deductibles. 

Friday, March 27, 2015

My Guesses about the Causes of Growth in Inequality

Income and wealth inequality seems to a hot topic lately. Here are my guesses about the causes of the growth in inequality

I agree with those on the left that a lot of income and wealth is random. 
But to me that does not mean that it can be changed. 
I for one am not sure what caused the increase in inequality though I have heard many of the theories, none seems to work. I think it might be multiple things like: 
  • Growth of finance (maybe Vanguard and the EMH will turn this around). 
  • Investors and management have discovered that better people raise profits and have started bidding good people's compensation up. 
  • Bigger markets for sports and entertainment. They are now worldwide markets. 
  • Anti-trust causes in sports. Monopoly sports leagues paid athletes much less, even with more teams and lower seat prices?
  • Software network effects. 
  • Growth in healthcare and providers influencing regulation.
  • Taxes were very high in the 1950 & 60s and that might have had some effect, but the rich did not pay much more of their income in taxes then than they do now. So I do not think that was so important.  If taxation had a big effect it could mostly be a  a measurement effect in that I bet a lot more income was hidden then. 

Tuesday, February 3, 2015

Gruber and the Employer Mandates

David Henderson made  a blog post that links to a a video in which Johnathan Gruber, in a wonderful display of candor, says that the employee will pay for his own health insurance through lower wages whether he writes the check directly to the insurance company or his employer writes the check.  Gruber then goes on to advocate for employer mandate?

So what are the plausible reasons to mandate that employers pay for health insurance:

Employers are more capable to handle the book keeping for their employees.
To fool people into thinking health insurance is cheaper than it really is
To fool people into thinking that the employer is paying for his health insurance.

So what are the plausible reasons to not mandate that employers pay for health insurance:

Because of politics the employer mandate will have exceptions that distort the labor market and hurt employees. 
The consumer is more ignorant of what health insurance really costs.
It ties employees too closely to their employer.
It is inefficient for small employers. 
It makes it more difficult to start a business.
It can advantage smaller of bigger business depending on exceptions.

I believe that on net that the employer mandates are a bad idea 

PBS A Path Appears

Watching the PBS video A Path Appears got me to thinking about how inefficient schooling still is. 

Our goals from schooling should be to give people the most useful and valuable education with the least amount of effort and time spent.  

We should always keep in mind that the time of the educators and and more importantly the students is valuable. This means that we should put some emphasis on getting the students knowledge and skills in as short a time as possible.  I do not think that there is much research on this. It seems we focus more on keeping people in school longer but people in poverty would benefit from getting to work sooner.

We should always keep in mind that not everyone can be above average and so we should focus on getting the most valuable and useful knowledge to people early rather than focusing on the hope of college. degrees help up compete for the better jobs but wisdom and knowledge can advance everyone without out competing others.

Monday, February 2, 2015

Left and Right Citizens Could Work Together on These

We live in a world that will have lots of regulation and redistribution of income, there is no getting away it. and left and right will never agree on how much of each we should have.

So let's, knowledgeable people on the left and right, work together to get rid of bad regulations and to improve the efficiency of redistribution. 

Some examples where we could work together:

  • Lets work together to ending silly and costly interventionism in the ME, Latin America and Africa. 
  • Let's make bank capital requirements that say every year the .5% of banks with the lowest % of capital must fold or be merged (or lose FDIC insurance) unless they have more that 35% capital.
  • Let's replace most welfare (TANF, SNAP, SS, subsidized housing) with a BIG (Basic Income Guarantee). 
  • Let's make medicare and medicaid only pay for treatments with good evidence of efficacy. 
  • Let's replace ethanol, solar and wind subsidies and CAFE standards with a carbon tax. 

The current policies on the related to above issues are the type of things that exist only because the voters are rationally ignorant, allowing the politicians to run roughshod over the public interest. Their are many similar areas where the knowledgeable left and right agree.

Tuesday, January 13, 2015

Advocate for the PPACA Aaron Carroll Agrees with Me

Aaron Carroll a strong advocate of the PPACA says: 

He and I are in agreement that it’s silly to continue to make it an employer’s responsibility to give health insurance to employees. It’s a quirk of history, and a tax-expenditure inducement that continues that practice. We’d all be better off decoupling insurance from employment.

Our biggest problem in politics today in not ideology but the interface between rationally ignorant voters and corrupt politicians. The employer mandate in the PPACA was created by our corrupt politicians to fool the rationally ignorant voters into thinking that the employer pays for the health insurance rather than it being paid for by the employee through lower wages.