Chess Champion Garry Kasparov to Run For Preseident

Kasparov represents Russian Democracy's best hope.

Pipe Dream

I was reading a bit over at the Financial Times about a global warming conference Bush summoned with all of the other big polluters (side note: in German the word for polluter is umweltverschmutzer, which amounts literally to something like earth dirty maker). Bush seems to have transitioned from the earth ain't warming, to the earth is warming but it is unclear what the causes are, to ok, the science is settled. Now I don't think there is much likelihood Bush will actually do anything substantive (like a revenue neutral carbon tax) other than maybe propose another alternative energy R&D tax credit or a tax deduction for purchasing a energy efficient domestically produced washers or other electronic appliances (maybe Maytag is a political contributor to the bushes). But I think maybe there is a chance that he would like to leave office with some warm fuzzies and after the unmitigated disaster that this administration has been (read: Iraq, Katrina, Gonzalez, etc.), something like climate change would allow for a bold bipartisan action to put a prettier patina on Bush's legacy. That said, I am not holding my breath.

Edwards Opts In To Public Financing

This surprises me. And the campaign is pretty straightforward about it, they aren't waxing poetic about the virtues of public finance but rather speaking of the need for cash as fundraising hasn't been up to par.

Home Sales

hat tip: Brad DeLong

Subprime Mortgage Delinquency Rates

hat tip: Brad Delong

Bryan Caplan Rails Against Stupid Voters

He lists four irrational biases that voters tend to have:
Anti-Market Bias
Anti-Foreign Bias
Make-Work Bias
Pessimistic Bias

Anyhow, giver her a looksie, Caplan is always worthwhile.

Econoblogosphere Diagramed

Portfolio.com has a cool diagram with links of the economics blogging community. Take note of the GMU mafia.

Why Conservatives will Never Make Inroads with the Youth

"the strength of a movement is highly correlated with its capacity to get you laid."

The Futility of Exercise?

Gary Taubes has an interesting article in the New York Magazine on why exercise doesn't do too much for weight loss.

Get Advesarial on Facebook

Stop adding friends on Facebook, get the enemybook application and add enemies.

The Case for Prostitution

Here is an interesting, really more depressing/humorous, argument for prostitution. The author is an aussie and he is not arguing so much for prostitution's legality but rather how prostitution is preferable to lying to get into a girl's pants. I disagree, but food for thought.

The French, Romney, and Republican Malaise

The Economist Euro Blog "Certain Ideas of Europe" has a little post on the poor dental hygiene practices of French children. Now they are relaying information as presented in Le Figaro and it appears that the article is piss poor reporting (a sample of two dentists quoting statistics without citation). That said, Europeans do have piss poor hygiene. What interests me is whether Mitt Romney somehow manages to fashion this into a campaign slogan or punchline. I can just imagine it "if we go forward with this socialized medicine business our children will be stopped in their tracks by vast European style bureacracies that ration toothbrushes and toothpaste." It is unfortunate but at the moment the republican base are a bunch of cheap dates that seem to be riveted by talk of killing jihadis, the damn French, and cutting taxes. A central tenet of Romney's campaign has actually been to talk shit about France. Not that I don't enjoy making French jokes ("I have a good French rifle for you, it's only been dropped once") but it doesn't constitute a policy prescription or a governance philosophy. If a republican wants to win the election they will have to discover a compelling narrative and this is usually rooted in sensible and appealing policy prescriptions. One arrives at sensible policy prescriptions by developing their own ideas and engaging others in order to determine their fitness, not by making jokes about how Europeans are a bunch of cheese eating, post historical, socialist surrender monkeys.

Hillary's Non-Inevitability

Hillary is starting to pull away from the pack in terms of polling (nevermind the fact that the Caucuses are still a ways away). The punditocracy is contemplating whether or not she will be able to bag the competition for good. I say no as the media likes a good story, a horse race, and will ensure that there is one.

Romney's Campaign is Starting to Crater

Romney's polling in New Hampshire has fallen off precipitously. If this happens in Iowa too I think he will be moving onto the second tier.

Obama's Strategy

Pundits are starting to question the wisdom of Obama's campaign strategy. Thus far he has been reluctant to take any shots at Hillary. I think this is a prudent strategy. If we look back at 2004 Gephardt was the favorite in Iowa and Dean was leading the national polls. Dean and Gephardt started to exchange blows through the airwaves and ultimately dragged each other down. Kerry and Edwards stayed out of this skirmish and surprised everybody during the caucus. I think Obama will keep his hands clean in hopes of Edwards bringing Hillary down a peg and knocking himself out in the process.

Best Line Ever by a Presidential Candidate

"I stuck the credit-card companies with $90,000 worth of debt!". Mike Gravel's response to a question about his personal bankruptcy. Inspiring.

Petrov Day

I did not know this but 9/26 is Petrov Day. He is a Russian that saved the world and then suffered immeseurably because of it. No, really it's true, check it out.

New Apple Product?

Apple is apparently developing a UMPC (basically a really small laptop).

Facebook Etiquette

Reihan Salam gives the rundown. I don't have enough friends where I have to worry about "un-friending" somebody. One of the few upsides to being a prick.

Gore to Run?

So Christopher Hitchens muses:

"So, and if I am right, the former vice president will then complete a year in which An Inconvenient Truth has been awarded an Oscar and he has authored a best seller. Roll it round your tongue again: an Oscar, a best seller, and a Nobel Prize in the space of 12 months or so. Not bad. And meanwhile, the field of Democratic candidates looks—how shall one put it?—a trifle etiolated. Sen. Clinton may have succeeded in getting people to call her "Hillary" and to have made them feel resigned to her front-runnership, but what kind of achievement is that? Sen. Obama cannot possibly believe, and doesn't even act as if he believes, that he can be elected president of the United States next year. John Edwards is a good man who is in politics for good reasons, but there is something about his populism that doesn't quite—what's the word?—translate.
Apart from the awards, not only could Gore claim that he had been a fairly effective senator and a reasonably competent vice president, he could also present himself in zeitgeist terms as the candidate who was on the right side of the two great overarching questions: the climate crisis and the war in Mesopotamia. Should I add that, whether or not he really won the Electoral College in 2000, he did manage to collect the majority of the popular vote? Several people, some of them well-informed, have been saying to me that Gore will wait until the Nobel committee's announcement before he makes up his mind. Should he make up his mind to run, he could alter the entire equation."

I think I saw this prediction before.

Brilliant Advice

Van Gogh on producing good work "you have to eat well, be well housed, have a screw from time to time, smoke your pipe and drink your coffee in peace.".

Truly Frivolous

Check this out, it is a wireless iPod speaker for your bike. Outstanding.

The Vote is In

I blogged a bit back about Marc Ecko, I labeled him a PeP Hero, and his winning bid for Barry Bond's 756th home run ball. Ecko set up a website allowing visitors to vote on what to do with the ball 1. Bestow it (give it to the hall of fame untouched); 2. Brand it (put an asterisk on the ball and send it to the hall of fame); 3. Banish it (send off to space). Well the vote is in:
A) BESTOW IT - 34% B) BRAND IT - 47% C) BANISH IT - 19%.

GM/UAW Strike Over

That was quick. The crux of the settlement is that the UAW will take over the health care for the workers. GM will provide a cash infusion at the outset and then wash its hands of the liability. This arrangement is modeled on the Goodyear compromise from not too long ago.

Why Be Effective When You Can Be Ineffective

Here are 7 habits of highly ineffective people. Learn these and you too can be a fed.

Bhutto Returns to Pakistan

Don't know exactly what this means but it seems to be a victory for the State department in the ongoing (dare I say eternal) turf war between State and Pentagon. Not knowing much about her rule except anecdotal info from some Pakistani friends is that she sucked, just in a different if not better or worse way than Musharraf.

Another Victory for Inumbency, Erg.

Apparently the gerrymandering reform in California is dead. I blogged about it here.

Big Time Baby

We are on the blogroll for Voxbaby. Voxbaby is run by Dartmouth Economist and Director of the Nelson A. Rockefeller Center at Dartmouth College. Unlike myself, he would be considered intelligent, accomplished, and respected. So this is quite the coup. As Ron Burgundy would say "We're kind of a big deal."

Sarkozy on Iran

Sarkozy has been talking tough on Iran which is out of character for European heads of state who are usually keen on playing the part of good cop to our bad cop in foreign policy when they agree with American foreign policy makers. It will be interesting to see how this develops. Pres. Bush went to war in spite of the vehement opposition of much of the world, what happens when a France is supportive and Germany mum on the issue?

More Kling

Kling has a good essay on hindsight bias in public policy discussions.

Jena Six Continued

Richard Thompson Ford has a good article on the Jena Six over at Slate.

O'Reilly Has an Epiphany

Bill O'Reilly recently sat down for lunch with Rev. (or race hustler/poverty pimp) Al Sharpton at Sylvia's in Harlem where he was shocked by the service. Media Matters has the goods:

'Bill O'Reilly reported that he "had a great time, and all the people up there are tremendously respectful," adding: "I couldn't get over the fact that there was no difference between Sylvia's restaurant and any other restaurant in New York City. I mean, it was exactly the same, even though it's run by blacks, primarily black patronship." Later, during a discussion with National Public Radio senior correspondent and Fox News contributor Juan Williams about the effect of rap on culture, O'Reilly asserted: "There wasn't one person in Sylvia's who was screaming, 'M-Fer, I want more iced tea.' You know, I mean, everybody was -- it was like going into an Italian restaurant in an all-white suburb in the sense of people were sitting there, and they were ordering and having fun. And there wasn't any kind of craziness at all."'

Classic!

Low Hanging Fruit

I think one of the things that should emerge given there is a consensus amongst health care policy experts is that a lot of health care spending is purely wasteful and for that matter harmful. I don't know if politicians will pick this up and run with it because the general formula for a campaign is for politicians to promise new spending not efficient spending.

There Are No Gays In Iran

'Mr. Ahmadinejad said: “In Iran, we don’t have homosexuals like in your country. We don’t have that in our country.”

The audience booed and hissed loudly.

“In Iran, we do not have this phenomenon,” Mr. Ahmadinejad continued, undeterred. “I do not know who has told you that we have it.'

Classic. Borat nodded approvingly.

GM/UAW Talks Stalled

UAW workers are officially on strike.

How Europe is Different

Gabriele Pauli, who is the favorite to become head of the Christian Social Union (CSU) in Bavaria, has proposed that civil marriages automatically expire every seven years unless the married couple opts to "renew" the marriage. Some background, in Germany marriage is conducted in two separate ceremonies, one a state or civil marriage, and two, a church marriage. In order for your marriage to be recognized by the state you must conduct a civil marriage, and it cannot be conducted in a church. The Christian Social Union is the Bavarian equivalent of the Christian Democratic Union (CDU) which prevails in the rest of Germany. Think of the DFL in relation to the Democratic party. I lived in Germany and this comes as no surprise to me. I think it has a fighting shot of passing.

Ron Paul...

If only he'd win.

Note: Are there any instances of this Obama girl phenomenon before this election?

Unite not Divide

While running for president Bush often claimed that he wanted to be a "Uniter, not a Divider". Well, if we look at public opinion polls I would say he has succeeded, just not in the manner he wanted.

Obama Launches a Lead Balloon

Obama is putting out a trial balloon on raising the cap for payroll taxes. Currently only the first $97k of income is subject to payroll taxes. The cap is indexed for inflation. Now it is certainly true that Social Security needs either more cash, fewer obligations, or a mixture of both. My objection with raising the cap on payroll taxes right now is that this would provide Congress with an additional $1 trillion over ten years to piss away. If past is prologue, Congress will take the additional revenues and use it to plug gaps in the general budget. The net result will be that people will be taxed at a higher level ostensibly to shore up social security without the intended end being satisfied. This is the virtue of personal accounts, it keeps the money out of congress's hands.

Pack is Back

Packers beat the Chargers. I am sure the Chargers are satisfied with their big offseason decisions, though let's recap: pussyfooted on the notion of whether to can Schottenheimer or not, watched Cam Cameron and Wade Phillips pick up head coaching gigs, then canned Marty Schottenheimer, and then hiring Norv Turner who has lost everywhere he has coached (including an abysmal tenure with the Redskins).

Newt May Run...

Or maybe not. He says he will run if he is able to put together $30 million by November 1st. I don't see that happening but I wouldn't be surprised. The republican slate is a bunch of pygmies. Huckabee is the only one that has impressed but from a policy perspective his proposals are to put it charitably, hopelessly naive.

Health Care: Tough Nut to Crack

Here is David Cutler over at Cato Unbound:

"We observe that areas that spend 30 percent more than other areas do not get better outcomes. It is possible that randomly cutting 30 percent of spending in high spending areas would not affect outcomes. But this is not likely. Cutting spending by 30 percent would almost surely eliminate some valuable services as well as some less valuable ones. One could make up for the loss of valuable services by providing other services that are low cost but not currently provided. Overall health might not be affected, but money would be saved. Better still would be to selectively eliminate the care that has little value and provide the other services that are valuable but are not currently provided. This would leave us spending less and with better health. I believe we can do this, but the task is harder than it seems at first pass. We don’t do ourselves any favors by pretending it is easy."

Toyota and GM in a Pissing Match

Autoblog chronicles the PR battle Toyota is starting to launch against GM on one of the car it is developing, the plug-in hybrid Volt. What this speaks to really is not that GM is about to take the world by storm with Green Cars but that it (and really all of the car makers) are starting to develop in earnest cars that will have a smaller environmental impact. Coupled with a carbon tax from the government I think this development could be accelerated significantly.

Thoughts on the Jena Six

I don't really know what exactly happened with the Jena Six but from what I gather a white kid hung a noose on a tree which is offensive beyond words, inflammatory only begins to describe it. That said, beating somebody till they are unconcious, then beating them some more afterwards doesn't strike me as particulary kosher either. Even if there was significant provocation, which there clearly was here.

Bloggers Wanted

Dani Rodrik asks of his readers which economist they would like to see start a blog. Joseph Stiglitz comes out on top. I would like Edmund Phelps and Amartya Sen to start a blog.

WTF!?!?!

This from Jeffrey Rosen's piece on Justice Stevens:

"A natural place for a Democratic president to start looking for candidates would be to choose a justice in the model of Breyer, Ginsburg or Souter. But liberal interest groups are unlikely to be satisfied with a justice in their molds for the simple reason that none of them are considered liberal enough."

I can imagine liberal folks won't be keen on a Souter replica, but Breyer or Ginsberg, especially Ginsberg. Am I missing something?

Statements That Will Make You Dumber

This from Dick Cheney in the WSJ:

“We have steadily reduced the annual rate of growth in non-security discretionary spending.”

Now I have already explained why this sort of statement is stupid before but let me rehash: The government could be characterized as an insurance company with a side business in defense. Outlays disproportionately go to Defense, Medicaid, Medicare, and Social Security (Homeland Security has a healthy and growing budget but it is still relatively small). Only defense is discretionary, which obviously has grown significantly, ergo "non-security spending". The entitlement program outlays are non-discretionary. The only way there will be a "cut in the rate of growth" in entitlement spending is if all of a sudden it becomes really cheap to treat seniors or everybody dies before they are eligible for Social Security; or, you change the relevant statutes that determine entitlement benefits. In fact, the administration did reform Medicare benefits, it added them thus making Medicare more costly. To say that you have decreased discretionary spending is a worthless claim. This administration hasn't done squat in terms of reining in spending.

Fred Thompson is Sexy?

Garance Franke-Ruta of the American Prospect and her personal blog the Garance answers in the negative.

Building on Ilya's Thoughts

Ilya is correct, the concept of Iraq is a fiction. The only compelling rationale for being there at this point is to referee the partitioning of Iraq. In Mickey Kaus' terminology to keep it as a "small hell" as opposed to a "big hell".

Envisaging Reality in Iraq

I haven't posted in a while - but this description of life in Iraq is just too arresting. It says it all. It's from the journalist Nir Rosen, who has been doing excellent work reporting on this mess. Check out his blog.

"The only way to avoid being seized by one of the many militias that terrorize Iraq is to travel with your own militia."

"Iraq" is a fiction; what exists are bands of petty countries, each fighting for dominance.

PeP Hero of the Month

Marc Ecko, the fashion designer, placed the winning bid for Barry Bonds 756th home run ball, the home run that broke Hank Aaron's record. He has created a website where you can go and vote on what he should do with the ball: 1. Give it to the hall of fame, 2. Brand it with an asterisk and give it to the hall of fame, 3. Banish it to outerspace. I say vote 2.

Maryland, Erg

So I just moved to Takoma Park, MD from Arlington, VA. They are about 10 miles about and similar from a socioeconomic standpoint. What I don't understand is how my auto insurance premium jumped from $330 per six months to $850. I have always maintained that Montgomery County drivers are worse than those of Northern Virginia but not nearly three times worse. In fact, everybody in the DC metropolitan area is a bad driver. My neighborhood is not bad, no worse than my previous neighborhood in Arlington in terms of safety. Evidence of this is the fact that my renters insurance only increased by 10% from the move. My guess is that Maryland prohibits insurers from assessing risk by using credit scores but that is just a shot in the dark. Anybody else have any guesses.

Ramesh Ponnuro On Republican Tax Proposals

Ramesh Ponurro has a great op-ed over at the NY Times on how the republican candidates are botching the tax issue.

DCPS

Matt Yglesias has an interesting post on D.C. public schools. He talks about the "undercrowding" which is an odd problem to have.

Sullivan Wrong on Part of Obama Tax Plan

From the AP:

"The IRS would send prefilled tax forms to 40 million workers who take the standard deduction and have a bank account. They would simply have to sign and return it, which Obama estimates would save more than $2 billion in tax preparer fees, 200 million hours of work and "an incalculable amount of headache and heartburn."

Andrew Sullivan's blog title reads- "Obama's Tax Pander." The first line of his post reads- "He'll get the government to do your taxes for you!" I don't think this is all that controversial. A lot of Americans don't itemize because they have nothing to deduct. The government has already witheld their taxes and computed the liability. The reason why one might oppose such a policy is that you don't want people completely detached from the effects of fiscal policy. That said, this doesn't seem all that controversial to me.

Suggested Weekend Jaunt for Those in D.C.

Apparently there is a scotch distillery in Sperryville, VA, the Copper Fox Distillery. I knew that you could get shine aplenty once you drove a decent distance out of the city but I had no idea you could find a scotch distillery. It's like Christmas in September. It's about 1.5 hours from D.C./NOVA. I've been to Sperryville, it's a cute little town with an emphasis on little. It's nestled at the foothills of the Appalachias around the Shenandoah National Park. Also, I would heartily recommend the Virginia Wine Country (especially the vineyards around Charlottesville- try the Viognier or Cabernet Francs).

Breaking Nascar News

Dale Earnhardt, Jr. will be driving the Mountain Dew car, way cooler than the Budweiser car, almost as cool as Kyle Petty's Mello Yello car from back in the day. Ricky Bobby's WonderBread car still reigns supreme.

Obama's Tax Plan, Part 1

Here is Obama on the Mortgage Interest Deduction:

"Today, we have a mortgage interest deduction, but it only goes to people who itemize on their taxes. Like so much in our tax code, this tilts the scales toward the well-off. Only a third of homeowners take advantage of this credit."

Ok, I'm with him on that. Tax deductions will always benefit those who are taxed the most, the wealthy. But read on.

"I’ll create a mortgage interest credit so that both itemizers and non-itemizers get a break. This will immediately benefit 10 million homeowners in America. The vast majority of these are folks who make under $50,000 per year, who will get a break of 10 percent of their mortgage interest rate. For most middle class families, this will add up to about $500 each year. This credit will also extend a hand to many of the millions of Americans who are stuck in the subprime crisis by giving them some breathing room to refinance or sell their homes."

How about instead of instituting fairness through more complexity in the tax code do it through simplicity, scrap the mortgage interest deduction. Is subsidizing home-ownership more compelling than say, health care? Or wage subsidies so that people can make their own choice on how to spend their money?

Another New Blog

It's the "End Poverty in South Asia" blog. As one might imagine it is a development blog and it is run by Shanta Devarajan of the World Bank.

Krugman

Paul Krugman has a new blog over at the New York Times.

TPMCafe

I have been reading TPMCafe which is absolutely top notch. One of the best blogs out there. Their regular contributors, all significantly to the left, are very smart. But they also attract some of the best conservative pundits and think tankers there are for their roundtable discussions. That said, the commenters on the site are atrocious. It makes the dailykos comments section look like like a panel discussion at Brookings. This is not a bash of the dailykos, it is what it is, which is a grassroots movement. The writing and contributors at TPMCafe are at such a high level, it's a shame that every comment is some sort of ad hominem attack.

The Return of the Ute

Grow your mullets, GM is thinking about bringing back the Camino/Caballero (A Camino is shown on the left). Though, it appears that an Ute would be brought back under the Pontiac or GMC badge. For those that are unfamiliar with a "Ute" or the Camino it is essentially part sedan/part pickup truck. To me it seems unseemly but I guess there is a following for this sort of thing. I guess it is the best of both worlds type of thing. A more recent rendition of the "Ute" was the Subaru Baja which was positively ugly which made it all the more endearing. I actually thought about getting one for my new car but opted instead for the ever masculine VW Rabbit.

Consumer Directed Health Care

Robin Hanson has an important point over at Cato Unbound which hits on the utility of increased cost sharing or consumer directed health care. I have previously mentioned the Rand Study which is cited by health care experts as the authority as it is the only randomized longitudinal study in the health care field.

Conservatives have maintained that consumer directed health care will lead to super savvy health care consumers who are able to bargain down costs and skimp on only inefficient care and revolutionize medicine as we know it. This premise has motivated the health care reforms that the Bush Administration has pushed, namely, Health Savings Accounts. Liberals have rightly pointed out that this is all a bit pie in the sky. Health care is such a complex field that is unlikely that consumers will get it right and that they will likely skimp on important care yielding unfortunate health outcomes. Or to put in other words, putting medical decisions in the hands of consumers is too risky. To validate this claim liberals often cite the Rand study. In the Rand study, patients were randomly assinged health plans that differed in the level of cost sharing. It is true that the Rand study showed that those that had higher levels indiscriminately skimped on medical treatments that were both effective and ineffective. This is true but ultimately in spite of the reduced care, those patients that had higher cost sharing did not demonstrate statistically significant differences in health outcome. While this does not necessarily support the conclusion that cost sharing will rid health care of all its woes, it does seem to disabuse the notion that cost sharing will harm the consumer. The consumer won't get better care or worse care, just less of it.

Super Duper Blog

Check out this blog: Rebuilding Place in the Urban Space. It is run by Richard Layman an Urban Development and Revitilizatin Consultant (from what I can tell that is how to make crappy neighborhoods nice). Niche blogs like these are the type of blogs that make the blogosphere so interesting. It presents good topical information but also access to expertise.

Walking Tours

If you are ever in D.C. you should do a walking tour. While D.C. is navigable by car, and it does have a pretty decent public transit system (not NYC level but good), walking is the best way to experience D.C.

Segways For Everyone

There is apparently a segway based polo league. This sounds incredibly lame. BTW, does anybody know anybody that actually owns a segway, like, a real person. Not a security guards or a Super Duper rich person that uses one to cart around his compound.

D.C. Almost #1

D.C. is tied with Atlanta for most congestion. L.A. takes the cake. Silver ain't bad.

Blogger Awards

The America's Future Foundation is giving away $10,000 to the best "liberty-minded" campus blogger (that's code for libertarian or small-government conservative). I am too old to enter (25 is the age cutoff and you have to be in grad or undergrad), otherwise I would clearly win. My co-bloggers while also quite talented, not as talented, certainly not as prolific, but talented, are pinkos and are thus not qualified for this particular bounty.

Snooty Eco-Friendly People Mover Niche?

Here is Mickey Kaus with an idea for a new car:

"Wanted--A Brentwood EcoZoomBox: Here's a lucrative market niche none of the auto manufacturers seem to have spotted: There is a huge pent-up demand among the West Side L.A. parents I meet for a) a minivan, meaning something like a front-drive SUV but with a Honda-Elementish low floor and ride height; b) big enough to have 7 seats; c) hip enough for a mom to be able to drive it and get admiring glances; d) hybrid, in a way that advertises its hybridness to the world (meaning essentially that it would be available only as a a hybrid). It wouldn't have to get 40 m.p.g. It could get 22 m.p.g.--as long is it got certifiably better m.p.g. than the non-hybrid equivalent. The point isn't to save the planet so much as to advertise how the planet might be saved--not necessarily a hypocritical posture... Since top mileage would not be a requirement, it could also be e) fast. ... This combination seems eminently do-able, but there's nothing I see on the market now that fills the bill. The Prius meets (c) and (d) but not (a) or (b)."

From London to Sydney on a Bus

Tyler Cowen is jealous, it sounds like hell to me.

Crack for Your Brain

Here is a little news item on Britney's (Spears that is) custody case.

"Upward Redistribution to the Rich"

Over at TPM Cafe's book club Jonathon Chait spoke of the Bush tax cuts as an "upward redistribution to the rich". I find this positively orwellian. The implication is that the government is taking the money from somebody (middle class or the poor) to pay the rich when in fact they are simply taking less money from the rich. There are conceivably instances where the government redistributes from the poor or the middle class to the rich, some have argued that Social Security is mildly regressive (the tax is a flat tax, it's capped, and the rich live longer), but income taxes don't fit this description. What Chait really means is that the Rich should have less of their money so that the government can spend more on goodies (education, health care, farm subsidies, whatever) to benefit the middle class or lower income folks. In fact, I find the whole business of labeling taxes and the like as a redistribution a bit misleading as it presumes an original distribution. It is not as if one day we awake with our bank accounts full of our yearly allowance, rather, our income, savings, and debts are the function of millions of independent transactions.

Sperm Markets

Apparently there is differential pricing for sperm on the basis of the education level attained by the donor. I suppose this is a good thing, I never thought much about it. I wonder how much I could get. I have a masters and am pursuing a JD.

More on Air Taxi

NY Times has an interesting article on Air Taxi. Check her out.

More Edwards

"The lesson Senator Clinton seems to have learned from her experience with health care is, 'If you can't beat 'em, join 'em.' I learned a very different lesson from decades of fighting powerful interests - you can never join 'em, you just have to beat 'em…
"And to show Congress just how serious I am, on the first day of my administration, I will submit legislation that ends health care coverage for the president, all members of Congress, and all senior political appointees in both branches of government on July 20th, 2009 - unless we have passed universal health care reform.

I wonder when he speaks of joining the special interests if working for Fortress Investments counts. I guess it was to learn about poverty (at $500k a year- part-time no less, that's a pretty sweet gig), like how to foreclose on a Katrina victim's home.

Interesting Development

Iraq has banned the Blackwater Security Company. Blackwater, like other private security firms, are not held to any of the particulars that order combat conducted by the military. So in essence they can shoot first and ask questions later. Part of the U.S. military strategy has been to lean on these firms so that the Administration can limit its political exposure by not having as many troops on the ground. Even with this backdoor troop augmentation there have clearly been an inadequate number of troops to stabilize the country. I think this will exacerbate matters. That said, it does show that the Iraqi government is showing some autonomy. Whatever, it's all a mess.

Pervert Alert

US Attorney arrested for trying to have sex with a five year old. You dirty pervert, off to jail for you.

Dane Cook

He is the new famous Comedian and he absolutely sucks. His appeal is entirely lost on me.

Oil Hits New High

Does that mean Edwards will call for a new round of investigations of oil companies while bemoaning excessive carbon emissions?

More on Health Care

I think there is really an absence of realistic discussion of first principles for healthcare reform. Everybody and their brother speaks of universality but more importantly are issues of affordability (both for an individual and in the aggregate), access, and innovation. These three elements do not all move in the same direction but are ultimately in competition. Most commentators and politicians agree that health care expenditures consume too great a portion of GDP and the rate of growth in this sector is too high. What do the Democratic proposals do to corral this growth? In my view it doesn't look like cost containment is even considered in these proposals. There seems to be some sort of premise that if we have universality that health care will be cheap of a sudden, as if universality of coverage were some sort of pixie dust. If you achieve universality of health coverage merely by extending SCHIP and subsidizing insurance you are not addressing the cost issue, rather you are exacerbating it.

Redskins Won

Beat the Iggles. 14 to more to go.

DayJet and Air Taxi

James Fallows has an excellent post on Air Taxi service. The development and affordability of VLJs (Very Light Jets) has made the air taxi business model possible.

No Bail..

Equals no White Ford Bronco chase. BOOOOO!

Bad Idea Finds Its Way To The Grave

TimesSelect is dead.

Off to the Wilderness We Go

Here is Jim Geraghty of the Campaign Spot:

"Hillary offers her health care plan, and Giuliani criticizes it, Romney criticizes it... I'd be surprised if we didn't have reaction quotes from McCain and Thompson shortly. This is a bit like last week with the MoveOn.org ad. The GOP candidates' comments are all fine, but notice that the forces on the left create the issue, and the Republican candidates respond. One is left wondering what it would take for a Republican candidate to throw down a gauntlet or put out an argument or idea that everyone else would have to respond to..."

Thus far, on the issues that matter (Mainly, Iraq and Health Care) the republican candidates have opted for truly banal statements as opposed to anything substantive. I don't really anticipate Thompson or McCain to come up with a health care proposal that goes beyond "let's extend the tax exemption to small businesses". This is small beer, indeed. And I don't really think that the candidates will be able to break out of this box as long as they confine themselves on some of the republican tax dogma. For instance, let's say Giuliani were to propose a revenue neutral carbon tax, well, Grover Norquist and company would jump down his throat for proposing a new tax. Never mind that such a proposal would be revenue neutral with an offset in either income or payroll taxes. The Anti-tax pledge that I believe all of the major candidates have signed onto is not even limited to tax rates but extends to deductions and credits. I doubt this will change until Republicans get whupped in '08 and possibly in '10.

OJ's Bond Hearing

OJ's bond hearing will be today to determine if he is a flight risk and whether or not he should be released on bail. I hope desperately that the court errs in judgment and will allow him to post bail for his release. I just love White Bronco chases scenes.

Clinton Proposes Limiting Healthcare Deduction

"Making the Employer Tax Exclusion for Healthcare Fairer: The plan protects the current exclusion from taxes of employer-provided health premiums, but limits the exclusion for the high-end portion of very generous plans for those making over $250,000."
-courtesy of Ezra Klein.

This is a good first step but it is all too modest. There is little sense in the health care exemption. By having one it simply necessitates higher marginal rates for the same people that are most likely to benefit from exempting health care from income taxes. How about we just get rid of the exemption and reduce marginal rates by the amount of revenue gained by getting rid of the exemption?

Greenspan Review

Brad DeLong reviews Alan Greenspan's new book in the LA Times.

Sprint Does Something Good, Sorta

Sprint is piloting a product, AirRave, in Denver and Indianapolis. This will be like the T-Mobile VOIP bit I blogged about awhile back. Older folks, but probably some young people too, are reticent to completely get rid of their land lines because of the sometimes shaky quality of cell-phone calls. The other reason being intentional redundancy (for instance, 9/11 knocked out cell phones in the d.c. area not landlines, a couple of years later we had a hurricane and the opposite happened). The AirRave, from what I can tell, is essentially a router that will boost your signal at home. I am sort of surprised that they are offering this service as Sprint is primed to roll out a National WiMax service and I don't know how this would fit in.

A First for IronChef

Rap Star (used in its most elastic sense) is on Iron Chef as a judge. Cat Cora is committing one of my biggest pet peeves, she has presented a dish with both a gelee and a foam. Nasty!

New VW Possibly Coming Stateside

This concept car is called the VW Up and it will be a rear engine car. I guess the design is a little bizarre but I like it. It looks like with gas prices staying high the trend of manufacturers developing subcompacts for sale stateside is here to stay.

More on Carbon Tax

Greg Mankiw has an Op-ed in the NY Times in favor of a carbon tax. He is currently serving as Mitt Romney's economics advisor, though, I don't think the Mittster has said boo about the carbon tax.

It's Official

OJ arrested for Armed Robbery. That's my boy!

Interesting if Contrarian Article

This over at Washington Monthly by Phillip Longman of the New America Foundation. He is arguing sort of in favor of our current system for caring for the uninsured, namely charity hospitals, but integrating these hospitals on a national level and providing them with more technical and financial support. Sort of a VA for the poor. I don't know what to make of it but interesting nonetheless.

OJ In The News

OJ is a suspect in a Casino break-in. My hunch is that he was looking for Ron Goldman and Nicole Brown Simpson's killer.

Geeks Save the World

Clive Thompson has a fun post on Geeks and their potential contribution to world problems (he cites Bill Gates and the Gates Foundation as an example). I too believe that geeks and nerds are essential to our survival and prosperity. This is disheartening as I am merely a dork, which I define as being interested in geeky and nerdy things yet lacking adequate intelligence to be proficient in them.

Hacks in Buckley's House

"Incidentally, I subscribed to The National Review a few weeks ago under the rationale that I need to follow conservative commentary, rather than just liberal commentary about conservative commentary. I haven't regretted it." -Ezra Klein.

Ezra Klein, for those of you who don't know, is a super smart liberal blogger and also writes for the American Prospect. While I applaud Ezra for engaging the other side, I don't think there is much worthy of engaging with at the National Review. The state of conservative commentary is much like the movement in general these days, piss poor. If you look at the National Review, and I say this in utter dissapointment as a conservative, the state of the magazine with few exceptions is hackish, reactionary, and dull. It is the former as opposed to the latter two that principally concern me. Conservativism is inherently reactionary. A central tenet of conservatism is the preference for existing institutions over new ones as they have demonstrated a degree of fitness that is evident in their mere existence. But there has been too much capitulation and cheerleading within the conservative movement, and this is especially so in the movement's flagship publication: the National Review. There are some good writers, Ramesh Ponurru springs to mind, but for the most part it is an uninspired and increasingly hackish lot. Larry Kudlow is a sycophant. Reading one of his columns will simply make you dumb. And the business of foreign policy, the notion of extending liberty is consonant to conservatism but the promotion of democracy where underlying institutions do not exist is a project that conservatives typically have not countenanced. The National Review boasts no shortage of boosters for these types of efforts whether it be the Michael Ledeen who I think is a bonafide loon or Cliff May. I don't even want to touch on the Weekly Standard which is expensive toilet paper that is running out of countries to propose invading. In the competition of ideas, the major conservative publications are no longer relevant.

Zingeriffic Quote

On one of Washington's power couples (Mary Matilin and James Carville):

"She's famous because she's the woman who ran the worst campaign in presidential history,** and he's famous because he's the guy who beat the worst campaign in presidential history." ... **--Bush, 1992.

From Kausfiles

More on Social Security

I was heartened the other day when Joe Biden (D-De) actually recognized the primary issue with Social Security: the trust fund is not a trust. The basic problem with social security is typical of any defined benefit pension.

First, let me go into some terms. When we think of pensions there are two types: defined benefit and defined contribution. Really the word pension conjures up the former to a much greater extent than the latter. A defined benefit pension is something that is decreasingly available but once was the norm. A defined benefit pension is at its name would imply: the benefits are defined. Say I worked for General Motors for 30 years as an arc welder and my final salary was $100,000. GM's defined pension plan as bargained for entitles me to say 65% of my salary from the date of my retirement to death. I would expect that there is some inflation adjustment. Now, General Motors doesn't do this out of the goodness of their heart but rather this is a supplementary form of compensation that comes at the expense of your wages. They are in essence saving and investing on your behalf. Now it sounds like a great deal, and it is for the worker, but it has some overwhelming downsides which is why the defined benefit is today largely extinct. The first basic problem is that a defined benefit pension is not portable, it was intended for an era when workers worked for the same company for their career. The other problem is that you are essentially up a river if your employer has failed to fund the pension fund adequately, this has been a problem for all defined benefit pensions whether they be offered by a private company, Social Security, or your local government (especially local governments).

A defined contribution pension is as its name would indicate: the contributions are defined, not the benefits. The 401(k), 403(b), Traditional IRA, Thrift Savings Plans are all forms of defined contribution pensions. You are able to set aside up to 15% of your pretax income in a tax deferred account and your employer can match up to 6% of your salary in the form of a tax deferred contribution. The virtue of a defined contribution pension is that you can take it with you, at a minimum what you have set aside (typically there is a schedule for the vesting of your employer contribution). The other virtue is that you don't have to worry about your employer inadequately funding it. Its core problem lies in the fact that employee is assuming some of the risk (that said, you don't have to worry about your employer shafting you, so risk is really in the eye of the beholder). How should you invest it? What happens when you retire, do you annuitize or simply draw down periodically?

How does this relate to Social Security? Well, Social Security is a defined benefit pension plan and it suffers the same problem that most defined benefit plans have: it's underfunded. Now, some will contest that the problem does not begin until 2040 when the trust fund is depleted. After all it says so according to the Social Security's Actuarial report. Well yes, and no. The actuarial projections are based on social security claims as payable under law. Right now, payroll tax revenues (the dedicated revenue source for social security) coming in are greater than social security benefits going out. If you account on a cash basis you would then show a surplus. But the problem is with pensions you account on an accrual basis. And there is a compelling logic to this. The revenues that are coming in are not only to cover present liabilities (i.e. Social Security checks being cut today) but also to cover future liabilities incurred today (i.e. to be able to cut Social Security checks to those who are paying payroll taxes now), thus when you prepare a financial statement you are to book the revenues in excess of your present outgoing benefits as a liability. The government doesn't do this. Every year for the past several decades, the congress has taken the surplus revenues from Social Security and uses it to plug in gaps in the General Budget. In return for pilfering the Social Security trust fund the Department of Treasury issues a special bond to the Social Security Administration and these bonds accrue interest. This has the effect of understating the true nature of the Government deficit. The unified deficit (=General Fund deficit + the social security surplus) is a good deal higher than the number the press touts whenever it reports the deficit numbers.

So how does this relate to Joe Biden and Social Security, well Sen. Biden was complaining that every year we raid the trust fund and spend all types of random crap and our day will come a lot sooner than people talk about. Sen. Biden's solution was to "stop raiding the trust fund". Well, congress has had the opportunity to show their restraint and has never been able to do so. Sen. Biden gets two points for honesty if not for the substance of his proposal. The principle virtue of Personal Retirement Accounts, or privatizing a part of Social Security was that while we are still collecting more than we pay out there would have been a mechanism to prevent the Social Security surplus from being frittered away.

Social Security Talk

Andrew Samwick, Dartmouth Economist and blogger, relays information over at his blog Voxbaby that Hank Paulson, Treasuary Secretary, is quietly mounting a campaign to make minor changes to Social Security. I don't really think there is much overlap in either party as to what changes would be acceptable. The obvious solution to deal with the explicit debt of Social Security is to raise the age eligibility or raise the cap on payroll taxes. To actually tackle the implicit debt that the Social Security Trust Fund represents would require much more drastic action. I thought the President's proposal was eminently sensible but I am obviously in the minority.

Mark Warner Running For Senate

This was inevitable. It will be interesting to see how this plays out. I think Warner has to be considered the odds-on favorite to win the Senate seat. He is still very well regarded in Virginia for his tenure as Governor (VA term limits Governors to one term). Demographically, Virginia is turning bluer as Northern Virginia has grown. Warner's likely opponents are Tom Davis, Eric Cantor, and Tom Gilmore. The former two could present a stiff challenge, Gilmore would get his clock cleaned.

Belated Sad Moment

I don't know how this slipped my attention but alas it did. Luciano Pavarotti has passed.

John Edwards Promises a Universal Entitlement

Edwards in an interview with Charlie Rose:

" Yes, I believe we do. I think that we tend to think of education as K through 12, maybe college and in some rare cases, graduate school. We should think of education as a birth-to-death experience in America. That means we get the kids as early as we possibly can, we head start basically 3- to 4-year-olds. That's not young enough. We can start much earlier, much more intensely but particularly focus on at-risk kids. Better training for those who teach in early childhood, better health care and nutrition, support for those kids. I think that there's some very specific things we should do in K through 12 such as provide bonus pay—raise teacher pay, generally. Provide bonus pay to teachers that will go to the most difficult places. And we've got to I think dramatically change No Child Left Behind. I just talked about college. Let me go to the last element which is the one that I haven't heard of, there's talk about. We know if you graduate from college this year that the information you learned, a huge amount will be outdated in five or 10 years, we have to be the most creative, innovative, best educated work force on the planet, so we need an infrastructure for continuing education after high school, college, or graduate school, whichever is the last part of your formal education. So we continue to learn. Now, I wish I could tell you I have a specific proposal on this. I don't, not yet. But I do believe that because—basically it's ad hoc now. We leave it to individuals or their employers the enormous responsibility of ensuring that 45-year-old workers or 50-year-old workers in America are up-to-date and best trained, best educated they can possibly be and I think we have to develop a national infrastructure for making sure people continue to learn as they age."

The man positively scares me. Now, part of this is simply paranoia as Edwards does not come out and say he believes there needs to be a "birth-to-death" entitlement to education but he sure seems to be gesturing in that general direction. I do think there is a very compelling logic to expanding access to preschool as the earlier the intervention the more effective it is (sadly the converse is true as well and later interventions are largely worthless). But this notion that there needs to be some "national infrastructure for making sure people continue to learn as they age" is frightening to me. There are oodles of vocational and technological education providers, not to mention for-profit and online providers (think of University of Phoenix) and one of the vastly underrappreciated resources, your local community college, which often excels at providing courses in marketable skills. Having taken courses from pretty much every type of educational provider (both for-profit and non-profit) the quality of instruction can be quite high and it is certainly widely available thanks to these "internets". Some people refuse to undergo continuing education simply because they don't like learning. That's unfortunate but I don't understand how you can actually do anything to change their minds (apparently promotions, greater pay, better job security and that it is often that you don't actually have to go to work while training [read: boondoggle potential] are inadequate incentives). And to me it does seem appropriate that the onus for continuing education is placed on employers and the employees themselves, namely, the parties who derive an immediate benefit from their continued educational efforts.

Tax Policy Cage Match of Midgets

Grover Norquist (aka Dr. Evil) and Jon Chait (if you don't agree with me you are not fit for polite circles) are having it out over tax policy.

Travis Henry

has nine illegitamate children by nine different women. He makes Shawn Kemp look like an amateur.

Pimp My JumboJet, part two

Apparently pimping your A380 costs $500 million.

Pie-Eyed Picayune Moving Up

According to the TruthLaidBear, PeP is the 42,259th ranked blog by traffic. In terms of relevance, easily somewhere between DailyKos and Powerline.

Bill Belichick is Fallible

Why are the Patriots trying to steal signals? Totally blows my mind. Is it not enough that they have Tom Brady AND Randy Moss? Very puzzling.

The Virtue of Single Payer, sorta

This from Matthew Yglesias:

"Be that as it may, I think Hanson's observation that "humans long ago evolved a tendency to use medicine to 'show that we care,' rather than just to get healthy" partially explains why things like the UK's National Health Service generate so much bang for the buck. In effect, a highly centralized state run health care system is able to put a cap on how much demonstrative caring can be done through the health care system. Nobody's going to say to his or her spouse, "well, sure we could afford the procedure, but it doesn't really stand up to cost-benefit analysis compared to spending the money on organic produce for the kids" but if bureaucrats stand in your way well, then, that's hardly your fault."

This is I think the chief virtue of a single payer plan which is it provides a clean and simple manner (if designed properly) to contain costs. I don't think such a plan is likely in our political systesm, especially when you look to Obama or Edwards' plans and is likely to simply replicate the deficiencies of our present system while sacrificing the benefits (namely innovation).

More On Health Care

Check out this piece over at Slate by Ray Fisman. He delves into the original sin of the American health care system-Employer Provided Health Care-and some of the inefficiencies these cause. He emphasizes the problem of preventative care as it regards to chronic diseases suffering due to employers constantly changing their health plans.

Tuesday Morning Quarterback

Now that the football season is underway, do go over to ESPN.com's Tuesday Morning Quarterback by Gregg Easterbrook. Easterbrook is a scholar over at the superlative Brookings Institute but his weekly NFL column easily trumps his more scholarly contributions. I am serious, it is that good. The only other sports column that comes close is Bill Simmons "The Sports Guy".

John Robb on Iraq

Robb has a good blog post on why we will, not should, but will stay in Iraq and Afghanistan for some time to come.

He lists three core reasons, the last of which intrigues me especially:

1. Superior Marketing
2. The elasticity of the conflict (i.e. the notion of a war on terror)
3. privatization of the conflict.

I don't know to what extent the last one actually explains the current acceptance or reluctance to alter the status quo. Clearly the lives lost have been far too many (one being too many). That said, in terms of historical norms of armed combat, Iraq casualties are strikingly few. That said Blackwater and security firms of the like do lose men in combat (under contract) and this does not figure into public calculus.


hat tip: Ross Douthat

Best Movie Ever Made...

Is being remade! Yes, I am speaking of Tron. You ask what is Tron? Well as Ricky Bobby would say "It won the Academy Award for Best Movie Ever!"

Pimp My JumboJet

I'm a bit late to the party on this one but this struck me as both incredibly cool and grotesque. Apparently, Lufthansa Technik is going to be doing a little side business of pimping out A380s (Airbuses JumboFlop) for CEOs and other assorted plutocrats. No word on whether Xzibit will be hosting a Pimp My Ride (JumboJets) episode.

I think I can hear Green Cowboy projectile vomiting.

We Come Provacotive

In a delightfully derivative fashion that only the blogosphere can muster, here is the economist blogging on Michael Clemens of the Center for Global Development reviewing the Paul Collier's influential development tract "The Bottom Billion" in Foreign Affairs:

"Here Mr Clemens seems to gesture toward perhaps the biggest and most controversial idea in development circles. Why would anyone with a robust sense of reality simply assume that each national jurisdiction contains the seeds of a viable economy? If we insist on thinking of development as a matter of national growth, we may well consign most of the bottom billion, and their children and their grandchildren, to unrelenting poverty trapped within their UN-recognised national prisons. Our real moral concern should not be the Central African Republic, but its unfortunate denizens. The best thing for their prospects may simply be to get out--to leave for a place where growth has already commenced. The West's many attempts to jumpstart growth where the world's poorest already reside has yet to work. So why does the international community insist on betting the poor's lives on the gamble that it will, finally, some day?"

Robin Hanson over at Cato Unbound

Robin Hanson, GMU Economist and prediction markets advocate, is blogging health care over at Cato Unbound (which is similar in format to TPM Cafe). I haven't read Hanson's lead essay, yet, but will be blogging it later. You could essentially sum up his views on health care accordingly: A lot of our health care expenditures (in his view half) do not result in a greater health outcome, thus, we should pursue policies that reduce our expenditures by the amount expended on wasteful procedures in order to free up resources for other health or utility gains.

Discussing Jon Chait's "The Big Con"

Over at TPM Cafe a bunch of super duper smart people (Will Wilkinson, Stephen Moore, Megan McArdle, Ross Douthat, Ezra Klein, and Paul Krugman) will be discussing Jonathan Chait's new book "The Big Con: The True Story of How Washington Got Hoodwinked and Hijacked by CrackpotEconomics". Chait mainly emphasizes the idiocy of the claim that tax cuts pay for themselves, which is definitely a feature of Republican rhetoric for tax cuts and clearly false. That said, he seems to assert that this is the only conceivable claim that could be made in favor of tax cuts, that in essence they are a free lunch. There are other claims to be made on behalf of tax cuts, efficiency, fairness (obviously this claim being hotly debated by both sides), reducing deadweight loss, and spurring economic growth. Anyhow, check it out as I am sure this "cyber panel" will have many interesting things to say.

More Articles on Subprime Mess

Tyler Cowen has a good article in the NY times on some of the difficulties in formulating a policy to address the subprime mess.

Ed Glaeser writes about possible solutions as well. He seems to be advocating something along the lines of the "Kling Debt-Equity Swap". He dismisses Dean Baker's "Own-to-Rent" policy which would prevent lenders from foreclosing on borrowers but borrowers would lose their equity interest while being allowed to remain in "their" home as a renter.

More Wise Words on the Suprime Mess

Here's Megan McArdle on pitfalls to avoid (ideally) in addressing the subprime mortgage mess:

• "Creating moral hazard
  
• Costing the government a scary enormous amount of money
  
• Outraging voters as the government taxes people in modest homes in order to allow people who bought more home than they can afford in those houses. Whether or not you think that this is common among those who have gotten themselves into subprime trouble, or even admire the redistributive justice of it all, this is a real sentiment out there, and politicians have to deal with it."

"These are reasonable goals. Against this, one has to weigh the fact that major crises are better averted earlier than later. But I am not yet clear on whether the mortgage market requires massive intervention, or just continual finesse."

More Subprime

This from Tim Lee over at the American Scene:

"I think that the fundamental problem in this case—one I haven’t seen discussed very much—is that people bought more house than they could afford. No amount of financial wizardry is going to change that fundamental point."

I think the reason that it isn't discussed more is that a "solution" to the subprime mess is a phenomenal way to pander/buy votes.

VW coming to D.C.

Booyah. Take that Michigan.

SmartCar Coming to the States...

starting January 08. Base pricing will be 12k. I don't think the SmartCar will retail that widely. I think its primary markets will be super eco-friendly environs where it functions as environmentally friendly consumption one-upsmanship over a Prius. Think Portland not Manhattan.

Google Phone

Here's Businessweek speculating on the future of the Google Phone or the gPhone. I think it should be called the G-Unit. They could do a whole cross-branding thing with 50 cent. You hear that Sergei; racked up another PHAT finders fee!

More Good Government

Awhile back Barack Obama had a minor ethics flare up concerning some of his investments. Many have questioned how blind Mitt Romney's blind trust will be. We all recall Bill Frists blind trust selling off shares of a health company (which if memory serves me correctly he had founded or his family had) just before the share value took a nosedive. We also recall Hillary Clinton's returns from commodities investments that would make the best hedge fund manager embarassed. And maybe we should also consider the bizarre ability of congressional members in the aggregate to vastly outperform the market in their personal investments. Maybe that's because Congress can legally conduct insider trading (hmmm).

When we talk about ethics reform and conflicts of interest the ability to trade on insider information (mind you, insider information that congress is in fact creating; members are actually allowed to review legislation before it becomes public and consider its commercial ramifications and trade accordingly) seems to stink phenomenally. One way to mitigate this would be mandate that congress members and Senate confirmed nominees put all of their financial holdings into index funds. This is what Judges do to make sure they do not have a significant material interest in company that tries a case before the court over which the judge presides. I think the same standard should apply to congress members as they consider legislation.

Gerrymandering Reform

It looks like Arnold Schwarzenegger is about to get his gerrymandering reform passed after all. Proponents often oversell the reform but I do think it is eminently worthwhile. Gerrymandering is the practice of drawing electoral districts for electoral advantage. This is what the big brouhaha down in Texas with Tom DeLay was about. It is one of many tools in the incumbents arsenal that makes them damn near invincible. This reform would have electoral districts drawn on a non-partisan basis. I think Iowa is the only state that has it already in place. Hopefully other states will follow California's lead. Kudos to the Governator.

More Apple Products

Here's the rundown courtesy of Engadget. Apple is rolling out a new iPod: the "fatty". It's basically like the nano but more squat and symetrical. They are marketing it as a cheaper more practical iPod video. They are also rolling out the iPod Touch, which is basically a phoneless iPhone. I don't really get the appeal because I don't like touchscreens but whatever.

Gibbs Racing Switches to Toyota

For those of you who don't know who Joe Gibbs is (shame on you, you are a miserable person), he is the best football coach to ever walk the face of the earth (It's not his fault that Dan Snyder owns the Redskins)? Now some might say that is a preposterous statement as surely Vince Lombardi or Belichick or Tom Landry deserve some props as well here. Well, that is wrong. Not only has Joe Gibbs led the most important Sports Franchise in the history of mankind to three Super Bowl victories (with three different QBs mind you) he is also a Nascar heavyweight. I don't recall Vince Lombardi having a winning team anywhere outside of the Football (not to mention that he stunk it up during his stint with the Skins). Anyhow, Gibbs in all of his Nascar genius is switching from Chevrolet to Toyota. I have no idea if this a sound decision because I don't follow Nascar or care for it but I will blindly champion anything Gibbs does.

Chairman Yi..

is on board. Yi Jianlian has officially signed with the Milwaukee Bucks. Crisis averted. No word on Laverne and Shirley Miller commercials (I expect a finders fee at least).

Sub-prime Remedies

Arnold Kling has an idea on how to "fix" the subprime mess. He calls it the "debt-equity swap". Essentially, for those that are unable to make payments now, he proposes having banks assume more of the mortgage debt themselves at the expense of the owners equity. This would essentially be as if the bank had put down the 20% down payment themselves. It's an interesting proposal. This seems to be the best proposal I have seen in terms of avoiding moral hazard.

More on Carbon Tax

Here is David Leonhardt on John Dingell's (D-MI) strained history with the environmental movement and newfound support for a carbon tax.

Here is Larry Summers in the Financial Times on climate change and the possible remedies. Here is a bit from the Summers article:

"Second, carbon markets are invitations to engage in pork-barrel corporate subsidy politics on a massive scale. If greenhouse gas emissions are to be substantially reduced, the value of the associated emissions rights will be in the tens of billions of dollars. While in principle emission permits could be auctioned, in practice they are always allocated administratively. "

Where have you heard that before?

Best Defense of Social Democracy and Interventionist Economics

The shortcomings of social-democracy are held to be revealed by unfavorable comparisons of Gross Domestic Product per capita. At the most basic level, this is tantamount to criticizing the Boston Philharmonic because it can't make foul shots. We suggest the object of economic activity is not the maximization of GDP, but of well-being or happiness. What's the difference?

If my preference is to work 30 hours a week for $45,000, rather than 40 hours for $60,000, and I am compelled to work the longer week, GDP is higher and I am worse off.

If I get worse health care paying $5,000 a year for a private sector health insurance policy than the same amount in taxes for a public system, GDP is the same but I am worse off.

If Consolidated Crappola, Inc. dumps toxic material into the air that worsens my emphysema, in contrast to a regulatory regime that reduced emissions and my adverse symptoms, GDP might be lower while I am better off.

So short of a treatise, GDP glosses over differences in the value of public and private consumption, discounts the value of public amenities, and implicitly assigns a negative value to leisure time.
- Max Sawicky

I ultimately disagree but this is the argument put as best I've seen.

Naked, Bold, Shameless Pandering

"Iowa, for good reason, for constitutional reasons, for reasons related to the Lord, should be the first caucus and primary," Richardson, New Mexico's governor, said at the Northwest Iowa Labor Council Picnic. "And I want you to know who was the first candidate to sign a pledge not to campaign anywhere if they got ahead of Iowa. It was Bill Richardson."

Jockeying for the First Primary

Traditionally Iowa, New Hampshire and South Carolina are the first primaries (or caucus for Iowa). The DNC added Nevada to the mix. A number of states, notably Florida and Michigan, are attempting to move up their primaries ahead of the four aforementioned states' primaries. Howard Dean and the DNC have threatened to exclude Florida and Michigan's state delegates from the nominating convention if they do so. My question is whether this actually represents much of a threat? The party conventions no longer nominate candidates. I think the last convention where a candidate was nominated was when Hubert Humphrey won the 1968 nomination in Chicago. Nowadays the nomination is wrapped up well in advance of the convention and the convention is essentially a fundraising/ad orgy. Whereas the primaries, especially the early primaries, have incredible influence over who will be the eventual nominee. I would think that Michigan and Florida would wield far greater influence over the course of the Democratic nomination if they pushed their primaries ahead of the others and lost out on being able to attend the convention than the other way around. Am I wrong?

The Greatness of Mugabe

Izzy Mutanhaurwa breaks down the disaster that Mugabe's rule of Zimbabwe has been:

"3. In 1997 the economy peaked at US$8.5 billion, exports at US$3.4 billion and employment at 1.4 million. At that stage we were: -

a. The largest exporter of tobacco in the world after the USA.

b. The sixth largest producer of gold.

c. The biggest market for South Africa in Africa.

d. The second largest economy in the region and with the third highest GDP per capita.

e. Life expectancy was about 60 years and we had a literacy rate of 85 per cent with 95 per cent of all children of school going age in school.

f. Inflation was 12 per cent.

g. The exchange rate was 12 to 1 against the US dollar.

Zimbabwe today has an economy that has shrunk by half to just over US$4 billion, exports by two thirds to US$1.4 billion. Employment has declined by 45 per cent and industry by 60 per cent. Agricultural output this year will be 70 per cent down on the level achieved in 1997. Mining output is down and falling rapidly. Tourist arrivals have fallen from over 1.2 million in 1997 to less than 300,000 this year.

Life expectancy has halved, income per capita has also declined substantially. National population has fallen from an anticipated 16 or 17 million to just over 10 million today with 4 million Zimbabweans outside the country and some 2 to 3 million incremental deaths over and above normal mortality. 60 per cent of all children are not in school and all State controlled institutions are in dire straights.

For a country not at war or under sanctions, these are the most precipitous declines in economic and social welfare ever witnessed. They represent a calamitous state of affairs with no sign of any resumption of either stability or recovery. In fact the decline has accelerated in recent months very dramatically.

The US dollar is now trading at 20 million old Zimbabwe dollars to one in the open market compared to 1 to 2 in 1980 and 12 to 1 in 1997. Nothing tells you more about the collapse in the economy than that single statistic."

Let's see if Chavez can do the same for Venezuela.

hat tip: Megan McArdle

Mike Nifong Goes To Jail

Only for a day but at least it's something.