It Costs Two Cents to Make a Penny

Which to me indicates that it is no longer a useful medium of exchange. Be done with the penny.

Scary Quotes

"3. Social Security won't much change, keeping in mind that the number of elderly voters is growing larger every day. Given all their elderly white voters, the Republicans are already "the party of Medicare." The Democrats have become "the party of Medicaid." That locks three major programs into place, more or less. I don't hear serious talk of major cuts in defense spending."~Tyler Cowen, Marginal Revolution

Cross Country Train

"Why don't more of us take the train, and why doesn't Washington invest in the rails across the country to give more of the country, and not just the northeast corridor, the pleasure of the Acela, with speeds up to 150 mph between Boston and Washington?" -Peter King, SI

This is a really stupid question. Why would you want travel across the country on speeds of up to 150 mph on a train when you can do so on speeds up to 500 mph in a plane? Trains are a very enjoyable and efficient means of travel for trips under 250 miles (and probably 500 miles for the forseeable future depending on the price of gas).

Trompe L'Oeil Speedbump

TTAC calls this the 'creepiest application of the “trompe-l’œil speedbump”'. I have to agree. I wonder if this is really more effective than a physical speed bump or will it just cause a couple of older folks to have a cardiac arrest when they are under the false impression that they just ran over some girl chasing after a pink ball in a parking garage?

Unfortunate Names: DC School Edition

One of the rumored short listers to replace Michelle Rhee (assuming that Mayor-Elect Gray cans her) is a fellow by the name of Robert Bobb, or to be less formal, Bob Bobb. While Bobb-Squared's parents must have had contempt for their child, they did create an impressive fellow. Here's his wiki.

PeP Phraseology

The word chillax is a hybrid of chill and relax. Some would say this type of word is superflous but I would argue its adoption in the urban lexicon is what makes the English language rich. Thus my shock and horror when I looked up the proper definition on dictionary.com to find it did not have an entry.

Rosy Scenario's Secret Identity

I have discovered Rosy Scenario's secret identity. Her true name is Brad DeLong. Go read the whole post. Brad's logic is that right now it is obscenely cheap to borrow money and thus the potential long term budgetary costs are negligible (especially when you consider the potentially high social costs of structural long term unemployment). Brad looks at the borrowing as a one time cost and seems to assume no difficulties rolling over the debt. That is more what worries me.

That said, I largely agree that we should have taken advantage of the low borrowing rates and cheap labor available during a recession and that the first stimulus could have and should have been crafted better (50% of it was wasted on poorly constructed tax cuts). I would like to see such borrowing paired with future tax increases and spending cuts as early as 2 years out.

If the Bush administration had done any work whatsoever on planning for high speed rail, upgrading our grid, or implementing more mass transit (hell, just fixing what ought to have been fixed such as bridges) we would be in a much better situation right now. A lot of those unemployed construction workers could have been employed in a beneficial manner (at a discount). The taxpayer would reap the benefit of an upgraded infrastructure (with extremely low financing costs, likely lower if paired with a credible deficit reduction plan).

Al, We Hardly Knew Ya

If the smoking gun is to be believed, Al Gore likes handjobs from strangers. I don't see that as a problem. That said, I wonder what Sen. Gore's voting record was on these types of activities? I think if Al Gore had introduced legislation once upon a time called the Massage Parlor Freedom Act or the Happy Ending Act that that might have softened some of the rough edges of his public image. Personally, I am always much more comfortable with a Democrat whose views of limiting government intervention extend beyond abortion and sexual orientation.

BP and Unemployment

I do like the following idea from Robert Reich: "The President should order BP to establish a $5 billion clean-up fund, and immediately put America’s army of unemployed young people to work saving the Gulf coast. Call it the new Civilian Conservation Corps."

PeP Endorsement

I am endorsing Blogger cum Senate candidate Mickey Kaus (D-CA) to be California's next Senator. Given my previously established influence over the interwebs, I firmly believe that this endorsement will have an earth shattering impact (Kaus thinks that he will get about 3% of the vote, my endorsement should probably swing another 1%).

My rationale for endorsing Mickey Kaus is principally self-serving (somebody needs to set the precedent of a blogger becoming a big time politician so that it's not perceived as crazy when I jump straight to the white house without holding major office) but there are also more substantive reasons. One, I think it is important for someone who will not be immediately perceived as a bigot (thus, not a republican) to advance a sensible enforcement first-legalization later immigration policy. Aside from being better policy I think this would have a salutary impact on the immigration debate. Two, Kaus while liberal, would promote heterodoxy in general. Once other politicians saw how reporters had a lip lock on his ass for going against the grain on major issues other politicians and candidates will have an incentive at the margin to act out of envy and see personal gain in telling their leadership to go to hell. Again, I think this too would have a beneficial impact on policy debates and ultimately on policy outcomes. So with that said, I endorse Mickey Kaus for Senator.

Sensible Celebrity Quote

Normally I cringe when actors and such offer their politcal opinions as they're policy advice tends be daft. That said, this, from James Cameron, is very sensible:
'"The government really needs to have its own independent ability to go down there and image the site, survey the site and do its own investigation," he said.
"Because if you're not monitoring it independently, you're asking the perpetrator to give you the video of the crime scene," Cameron added.'

My Influence is Boundless

My call for a BP boycott is mushrooming. I am one of the most important people on the internet. See this article, it may not mention me by name, but it is really all about me. I get results.

Great Sentences

I loved this sentence from Politico (the quotes are from President Bill Clinton stumping for Blache Lincoln):
“'If you want to be used that way, have at it,’ he said to about 200 Democrats at Philander Smith College, speaking without notes for 20 minutes."

BP Sucks

Just a public service announcement. Go anywhere else but BP. Boycott BP.

How To Lose an Election: Vincent Gray Edition

Lesson 1: Do not oppose a popular program that your opponent supports, highlight said opposition, then only to knuckle under once you discover that it is popular within the same day.

Example: Vincent Gray earlier tried to strip funding from the streetcars in the d.c. budget and tried to use it as an issue to bash Mayor Adrian Fenty over the head with. Now this is stupid for many reasons. The streetcars are a good idea. They will enahnce connectivity in the core and are already spurring development. Wait, you ask, "how can nonexistent streetcars spur development?" Well, the streetcars are not running, however, a lot of construction has already occurred. The streets where the first phase of the streecar implementation is supposed to occur have already been dug up to set up the utilities, tracks have been laid for the majority of the routes, and actual streetcars have been purchased and delivered. This sends a signal to investors and potential homeowners. Potential homeowners might be willing to forgo amenities presently for rising property values later. Restaurants are willing to open up now to take advantage of cheap rents. Businesses relocate in anticipation of new foot traffic. So a large part of the work has been done and good amount of the money spent and to some degree the benefit has already started accruing. Unless you think that it is a foolish project it would make no sense to terminate it at this point. Anyhow, apparently Vincent Gray came to this same conclusion after half the city called his office in an uproar (in his defense, the majority of the council voted with him to strip out the funding, it was 11-2 vote- but they were not running for mayor).

"The Battle"

I agree with Bryan Caplan's take on Arthur Brooks new book; I wish I agreed with the premise but I think it is absurd. Brooks is arguing that 2/3rds of Americans are solid free enterprise folks but the other Social Democratic 1/3rd has managed to capture all influence and power and steer the country towards sclerosis (read: Obamacare). I don't think the median voter has all that coherent a political ideology. I think at the federal level politics seems to large, distant and abstract to really have any influence. That Americans are at heart more libertarian is probably true in relationship to the average European but Americans like a lot of interventionism too.

Massachusets: Our Health Care Future

It is rare in the policy realm where we can refer to a natural experiment. Massachussets is one such example and what this portends for the nation's future fiscal health is bleak. I think this quote from Megan McArdle sums up the issues with both the Massuchussets universal plan and Obamacare: "It's hard to simultaneously expand demand, while lowering the incentives for supply (i.e. Medicare reimbursements), without having some pretty dramatic mismatches between the two."

Two Sides of the Same Coin: Excessive Spending/Insufficient Revenue

The Center of American Progress has an interesting little bulletin documenting that Greece was not extraordinary in its spending but rather in its lack of revenues which were far below the average for Eurozone members. The bulletin then goes on to state that this notion of excessive spending being the cause of the Greece's demise is a myth. Their argument relies on two basic observations- Greece was close the median amongst Eurozone memers in terms of spending in relationship to GDP and Greece was at the bottom amongst Eurozone members in terms of revenues. I actually get their argument. They are making a technical argument that if Greece had a more efficient tax system they would have collected a similar ratio of revenues to GDP then in theory their fiscal deficit would be nowhere near what it is now.

In reality this argument is stupid. It would be like me saying: "The problem is not that my lifestyle outpaces my means, but rather I am not paid enough". Both statements in that sentence are saying the same thing but from different directions. Greece didn't have an efficient tax system like the median member of the Eurozone, which would lead to the obvious conclusion that it could not afford the median member of the Eurozone's spending habits. That it did spend thusly indicates that in fact, Greece's spending was excessive. There is no such thing as a spending problem that isn't a revenue problem or vice versa. In the end it is question of making tradeoffs which nobody can postpone indefinitely. That is the lesson I hope, but doubt, our lawmakers will take from Greece.

Public Sector Wages

Though it pains me to say this as a civil servant I think it is absurd that public sector wages have not been reduced or at the least frozen. If private sector wages, which when taxed are fund to public sector wages, stagnate or fall it would seem to me that public sector wages should similarly be reduced or cut. While I recognize stimulus was necessary (though I thought it was wet pile of dog shit), as the economy rebounds we will need to start acting aggressively on budget deficits. Cutting salaries is obviously a small step but it should be among the tools available.

The Next Global Depression

This from Tyler Cowen: "6. Basically the ECB is monetizing bad government debt claims." I think the net result of all this will be that Northern European governments and banks will be able to paper over Southern European's debts for a time but the cumulative result is that moral hazard has become more pronounced and global in nature. Increasingly it seems that the counter measures to this recession will be the proximate cause for a global depression.