November 29, 2005
Here Are the Rules
Excerpt from Economist's View:
Here are the rules I try and play by. I advocate government intervention only when I can justify it through economics, otherwise I believe in the market's ability to do what we expect it to do, deliver goods as cheap as possible in the correct quantities. My default is a laissez faire approach. I don't advocate government sponsored healthcare and social insurance because I like bloated government, I do it because I believe these are instances where the private market cannot, without regulation or intervention, provide the proper quantities of goods and services at the lowest possible price. I don't think the government should be more active in preventing monopoly power because I dislike big business, I say that because I want a competitive marketplace. I don't want to hug trees of infinite utility, I want market based solutions to environmental problems whenever possible. Simple market principles can do wonders for recycling and conservation programs. I want efficient taxes that minimize distortions. I believe in equal marginal sacrifice to fund government, but that is a normative choice, not something derived from economics. Government should not be any larger than necessary. I don't advocate redistribution of income for the sake of "equity," but I do believe the government should ensure that everyone has an equal chance in life, not an equal outcome but an equal start, and that may involve redistributive policies.
The Divided Welfare State
Excerpts of Paul Krugman's recent article via Mark Thoma
Of this article MoJo says:
In 1995 Germany and Sweden spent about 27 percent of GDP on after-tax social welfare expenditures—and two percent of that was "private" spending (i.e., by employers). The United States, meanwhile, spent 25 percent of GDP—and 8 percent of that was private.
Certainly the American "divided welfare state" is better than Swedish-style socialism for workers who have stable jobs with good pensions, 401(k)'s, and plum health care benefits, but for everyone else, it's inequitable, regressive, and a source of uncertainty for those increasingly at risk of losing their jobs. (Indeed, it's becoming a worse deal for many workers with stable jobs, as they face greater cost-sharing for health care or as companies default on their pension funds, or what not.) In the old days, though, businesses loved it, and some of them even backed the creation of entitlements like Medicaid and Medicare as ways of reinforcing the status quo.
But now many companies look ready to shift more of the welfare burden onto the government, and move towards a European-style welfare state, although Daniel Gross has noted that there are two types of companies here—those that, like GM, want the government to pick up its health care and pension costs, and those, especially newer, high-tech companies, who still want tiny government. Meanwhile, 60 percent of workers still get their health benefits through their company (although that number's declining), so it's not clear how many voters actually want to shift to a European-style welfare state, at least right now. Change won't be easy, although the opportunity is certainly there. Also, those companies that no longer want to be on the hook for, say, health care costs aren't necessarily going to push for single-payer, or France-style health care. They could just as easily be convinced to agree to the Bush administration's horrible HSA proposal, which would shove people onto the open insurance market. That, I think, is going to be a major fight.
Age of Anxiety and Job Insecurity
by Paul Krugman
NY Times:
Many eulogies were published following the recent death of Peter Drucker, ... however, ... few ... mentioned his book "The Age of Discontinuity," a prophetic work that speaks directly to today's ... economic anxieties. Mr. Drucker wrote "The Age of Discontinuity" in the late 1960's, a time when most people assumed that the big corporations ... like General Motors and U.S. Steel would dominate the economy for the foreseeable future. He argued that this assumption was all wrong.
It was true, he acknowledged, that the dominant industries ... of 1968 were pretty much the same as the dominant industries ... of 1945, and for that matter of decades earlier. ... But all of that, said Mr. Drucker, was about to change. New technologies would usher in an era of "turbulence" ... and the dominance of the major industries ... of 1968 would soon come to an end. He was right. ... Many of the corporate giants of the 1960's ... have fallen on hard times, their places in the business hierarchy taken by new players. General Motors is only the most famous example. So what? ...: why does it matter if the list of leading corporations turns over every couple of decades, as long as the total number of jobs continues to grow?
The answer is the reason Mr. Drucker's old book is so relevant...: corporations can't provide their workers with economic security if the companies' own future is highly insecure. American workers at big companies used to think they had made a deal. They would be loyal to their employers, and the companies in turn would be loyal to them, guaranteeing job security, health care and a dignified retirement. Such deals were, in a real sense, the basis of America's postwar social order. We like to think of ourselves as rugged individualists, not like those coddled Europeans with their oversized welfare states. But as Jacob Hacker of Yale points out in his book "The Divided Welfare State," if you add in corporate spending on health care and pensions ... we actually have a welfare state that's about as large relative to our economy as those of other advanced countries. ...
November 22, 2005
November 21, 2005
One Bad Murtha
Although I and Rep. John Murtha share deep-seated reservations about the invasion of Iraq, his proposal for an immediate withdrawal of our troops can't be the solution, can it?
Should we be occupying this sovereign nation? Many say no. Do the Iraq people want us there? It appears increasingly unlikely. A unilateral pulling out of our troops will leave a power vacuum, and as your 9th grade physics teacher taught you, nature (and unstable nations) abhor those.
The only real question that would surround Murtha’s proposed withdrawal is not whether or not Iraq prosper, but rather to what degree will the Iraqi people suffer at the hands of whatever ruthless opportunist manages to scrap together enough men to seize Baghdad and claim authority. Will it be an Iranian-style Ayatollah? A neo-fascist in the pattern of the Ba’ath party? An ideological centrist utterly incapable of managing this volatile region? Only time would tell.
It is true that the continued presence of occupation forces incites the insurgency, but what is our alternative? Is it time to institute a gradual reduction?
This was hastily written for a debate class editorial assignment.
All this being said, I am very willing to have my mind changed
'Kelo' Land Unseized
Last summer Sarah and I visited New London when we were in town on a pilgrimage to Mystic Seaport. The Supreme Court had yet to make their disastrous ruling, but it was clear why this town was home to a property-rights showdown, being a run-down, character-rich town, home to the Coast Guard Academy and a sub base, on a great stretch of water.
So this is what has become of that valuable neigborhood corner.
November 18, 2005
Slasher House
Have you heard some of the heated debate about this?
Didn't we see abhorent poverty with Katrina?
Slashes to student loans, food stamps, medicaid. Honestly.
November 16, 2005
This isn't the Real America
This isn't the real America
By Jimmy Carter
JIMMY CARTER was the 39th president of the United States. His newest book is "Our Endangered Values: America's Moral Crisis," published this month by Simon & Schuster.
November 14, 2005
IN RECENT YEARS, I have become increasingly concerned by a host of radical government policies that now threaten many basic principles espoused by all previous administrations, Democratic and Republican.
These include the rudimentary American commitment to peace, economic and social justice, civil liberties, our environment and human rights.
Also endangered are our historic commitments to providing citizens with truthful information, treating dissenting voices and beliefs with respect, state and local autonomy and fiscal responsibility.
At the same time, our political leaders have declared independence from the restraints of international organizations and have disavowed long-standing global agreements — including agreements on nuclear arms, control of biological weapons and the international system of justice.
Instead of our tradition of espousing peace as a national priority unless our security is directly threatened, we have proclaimed a policy of "preemptive war," an unabridged right to attack other nations unilaterally to change an unsavory regime or for other purposes. When there are serious differences with other nations, we brand them as international pariahs and refuse to permit direct discussions to resolve disputes.
Regardless of the costs, there are determined efforts by top U.S. leaders to exert American imperial dominance throughout the world.
These revolutionary policies have been orchestrated by those who believe that our nation's tremendous power and influence should not be internationally constrained. Even with our troops involved in combat and America facing the threat of additional terrorist attacks, our declaration of "You are either with us or against us!" has replaced the forming of alliances based on a clear comprehension of mutual interests, including the threat of terrorism.
Another disturbing realization is that, unlike during other times of national crisis, the burden of conflict is now concentrated exclusively on the few heroic men and women sent back repeatedly to fight in the quagmire of Iraq. The rest of our nation has not been asked to make any sacrifice, and every effort has been made to conceal or minimize public awareness of casualties.
Instead of cherishing our role as the great champion of human rights, we now find civil liberties and personal privacy grossly violated under some extreme provisions of the Patriot Act.
Of even greater concern is that the U.S. has repudiated the Geneva accords and espoused the use of torture in Iraq, Afghanistan and Guantanamo Bay, and secretly through proxy regimes elsewhere with the so-called extraordinary rendition program. It is embarrassing to see the president and vice president insisting that the CIA should be free to perpetrate "cruel, inhumane or degrading treatment or punishment" on people in U.S. custody.
Instead of reducing America's reliance on nuclear weapons and their further proliferation, we have insisted on our right (and that of others) to retain our arsenals, expand them, and therefore abrogate or derogate almost all nuclear arms control agreements negotiated during the last 50 years. We have now become a prime culprit in global nuclear proliferation. America also has abandoned the prohibition of "first use" of nuclear weapons against nonnuclear nations, and is contemplating the previously condemned deployment of weapons in space.
Protection of the environment has fallen by the wayside because of government subservience to political pressure from the oil industry and other powerful lobbying groups. The last five years have brought continued lowering of pollution standards at home and almost universal condemnation of our nation's global environmental policies.
Our government has abandoned fiscal responsibility by unprecedented favors to the rich, while neglecting America's working families. Members of Congress have increased their own pay by $30,000 per year since freezing the minimum wage at $5.15 per hour (the lowest among industrialized nations).
I am extremely concerned by a fundamentalist shift in many houses of worship and in government, as church and state have become increasingly intertwined in ways previously thought unimaginable.
As the world's only superpower, America should be seen as the unswerving champion of peace, freedom and human rights. Our country should be the focal point around which other nations can gather to combat threats to international security and to enhance the quality of our common environment. We should be in the forefront of providing human assistance to people in need.
It is time for the deep and disturbing political divisions within our country to be substantially healed, with Americans united in a common commitment to revive and nourish the historic political and moral values that we have espoused during the last 230 years.
November 10, 2005
Wal-Mart and Frugality's Folly
Here is an interesting article about Wal-Mart, which reminds me of an editorial by Marvin Olasky. Dr. Olasky wrote about how he was once about to turn away a boy selling magazines door-to-door, because the magazines could be had cheaper in other places, but spoke to the boy about his awful traveling conditions at the hands of his emplyer. Olasky bought some subscriptions, reflecting on the fact that buying the absolutely cheapest product is not always the best idea (as they often come at the expense of the least among us), and is certainly not a biblical mandate.
Frugality is not a spiritual discipline. Yet, Americans regularly follow weekend trips to places of worship with drives to giant discount stores. Jewish, Christian, and Muslim traditions unite in challenging those of us who would save a buck at the cost of another's well-being. Unfortunately, in our current culture, getting a "deal" has largely displaced righteous dealings as our first consideration in the marketplace.
Wal-Mart and frugality's folly
by C. Melissa Snarr
SojoMail 11-09-2005
Frugality is not a spiritual discipline. Yet, Americans regularly follow weekend trips to places of worship with drives to giant discount stores. Jewish, Christian, and Muslim traditions unite in challenging those of us who would save a buck at the cost of another's well-being. Unfortunately, in our current culture, getting a "deal" has largely displaced righteous dealings as our first consideration in the marketplace.
Within the Christian tradition, the term frugal is wholly absent from the biblical text and is not among the fruits of the spirit in Galatians 5:22-23. Generosity is instead the prized theme in stories of faith. God enables human generosity by promising a care for believers and creation that allows us to put our store in heaven not in barns or walk-in closets here on earth. The images are numerous: banquet tables set for the homeless, fishes and loaves multiplied, water turned into wine, and manna falling from heaven. Throughout scripture, generosity is structured by obligations to the most vulnerable. Rulers, merchants, and nations are judged by how they treat the poor, widowed, and orphaned. Faithful generosity follows God's preference for those normally forgotten by society.
Admittedly, we saw a glimmer of generosity in Wal-Mart's speedy delivery of desperately needed supplies to hurricane victims last month. They were first on the scene to the poor, widowed, and orphaned among us. But to focus only on Wal-Mart's short-term charity misses major dimensions of the biblical concept of generosity. Modeled on the nature of God, the creating, sustaining, and redeeming character of biblical generosity is not about short-term charity but long-term justice for all God's children. The sustaining life of God is about creating structures and cultures of care, wholeness, and fairness that are enduring. Wal-Mart's charity should not divert public - particularly religious, attention - from the largest retailer's long-term discrimination, import exploitation, and overtime and union-busting scandals. In contrast, faithful generosity is not primarily about short-term gifts to the needy, but the long-term task of building right relationships, weaving righteousness into the fabric of our lives.
The biblical exhortation, "From everyone to whom much has been given, much will be required" (Luke 12:48), is about an understanding of stewardship that is always bound to fair use. Stewardship underscores our humble understanding of our temporary ownership of common goods and the obligations for equity and sustainability tied to that privilege. Unfortunately, Wal-Mart's current dominance of the market is draining rather than sustaining local communities. Every Wal-Mart store employing 200 or more people costs taxpayers more than $420,000 in government social services used by employees whose low wages and unaffordable health insurance mean they largely subsist among the ranks of the working poor, according to "Everday Low Wages: The Hidden Price We All Pay for Wal-Mart," a February 2004 report by the Democratic staff of the House Committee on Education and the Workforce. Wal-Mart's anti-union policies also prevent workers from organizing for wages and benefits to support their families.
In contrast, unionized workers in the retail food industry earn 30% more than their nonunion counterparts. Every time Wal-Mart increases its market share by 1% in the grocery business, cashier's wages in the local market drop an average of 5.5 cents per hour. And Wal-Mart's market share has grown by 20% in the last five years, according to United Food and Commercial Workers. Yet if Wal-Mart paid each employee $1 more an hour, it could maintain its current profitability level by increasing prices a mere half-penny a dollar. See also, "The Impact of Big Box Grocers on Southern California," a September 1999 report prepared by the Orange County Business Council of California.
Corporate giants regularly justify these practices by appealing to the needs of their hourly employees. They see themselves as serving those who live paycheck to paycheck and must be frugal. This is perhaps the most appealing and invidious part of Wal-Mart morality. In the process of "serving" its employees and consumers, Wal-Mart actually lowers the workplace quality of the retail sector and entraps communities in practices of inequity. When the standard bearer and largest retailer in the world refuses to pay wages that support families, undermines organizing for greater benefits, and imports well over half of its merchandise from countries with little or no labor regulation, they effectively place a lock on the door to class mobility for the entire discount retail sector.
Cheap products are not valued in and of themselves by religious traditions. As the Wal-Mart public relations machine continues to gain momentum, people of faith need to think more about our economic witness and demand that our discount giants do not discount human dignity in our name.
C. Melissa Snarr is an associate professor of ethics at Vanderbilt University in Nashville, Tennessee, where she teaches courses ranging from Early Christian Political Thought to Religion and War in an Age of Terror.
November 09, 2005
Pride, Prejudice, Insurance
Below is Paul Krugman's editorial from Monday, Nov. 7th, previously referenced by Jeff.
Among the highlights:
Why does American medicine cost so much yet achieve so little?
Unlike other advanced countries, we treat access to health care as
a privilege rather than a right. And this attitude turns out to be
inefficient as well as cruel.
I had to look around a bit to find it, now that the Times 'Select' has blocked the editorials and features from those of us who can't afford it or the paper version. Do you know of an easier link to regular columns?
Pride, Prejudice, Insurance
Paul Krugman
New York Times, The (NY)-November 7, 2005
General Motors is reducing retirees' medical benefits. Delphi has
declared bankruptcy, and will probably reduce workers' benefits as
well as their wages. An internal Wal-Mart memo describes plans to
cut health costs by hiring temporary workers, who aren't entitled
to health insurance, and screening out employees likely to have
high medical bills.
These aren't isolated anecdotes. Employment-based health insurance
is the only serious source of coverage for Americans too young to
receive Medicare and insufficiently destitute to receive Medicaid,
but it's an institution in decline. Between 2000 and 2004 the
number of Americans under 65 rose by 10 million. Yet the number of
nonelderly Americans covered by employment-based insurance fell by
4.9 million.
The funny thing is that the solution -- national health insurance,
available to everyone -- is obvious. But to see the obvious we'll
have to overcome pride -- the unwarranted belief that America has
nothing to learn from other countries -- and prejudice -- the
equally unwarranted belief, driven by ideology, that private
insurance is more efficient than public insurance.
Let's start with the fact that America's health care system spends
more, for worse results, than that of any other advanced country.
In 2002 the United States spent $5,267 per person on health care.
Canada spent $2,931; Germany spent $2,817; Britain spent only
$2,160. Yet the United States has lower life expectancy and higher
infant mortality than any of these countries.
But don't people in other countries sometimes find it hard to get
medical treatment? Yes, sometimes -- but so do Americans. No,
Virginia, many Americans can't count on ready access to
high-quality medical care.
The journal Health Affairs recently published the results of a
survey of the medical experience of "sicker adults" in six
countries, including Canada, Britain, Germany and the United
States. The responses don't support claims about superior service
from the U.S. system. It's true that Americans generally have
shorter waits for elective surgery than Canadians or Britons,
although German waits are even shorter. But Americans do worse by
some important measures: we find it harder than citizens of other
advanced countries to see a doctor when we need one, and our
system is more, not less, rife with medical errors.
Above all, Americans are far more likely than others to forgo
treatment because they can't afford it. Forty percent of the
Americans surveyed failed to fill a prescription because of cost.
A third were deterred by cost from seeing a doctor when sick or
from getting recommended tests or follow-up.
Why does American medicine cost so much yet achieve so little?
Unlike other advanced countries, we treat access to health care as
a privilege rather than a right. And this attitude turns out to be
inefficient as well as cruel.
The U.S. system is much more bureaucratic, with much higher
administrative costs, than those of other countries, because
private insurers and other players work hard at trying not to pay
for medical care. And our fragmented system is unable to bargain
with drug companies and other suppliers for lower prices.
Taiwan, which moved 10 years ago from a U.S.-style system to a
Canadian-style single-payer system, offers an object lesson in the
economic advantages of universal coverage. In 1995 less than 60
percent of Taiwan's residents had health insurance; by 2001 the
number was 97 percent. Yet according to a careful study published
in Health Affairs two years ago, this huge expansion in coverage
came virtually free: it led to little if any increase in overall
health care spending beyond normal growth due to rising population
and incomes.
Before you dismiss Taiwan as a faraway place of which we know
nothing, remember Chile-mania: just a few months ago, during the
Bush administration's failed attempt to privatize Social Security,
commentators across the country -- independent thinkers all, I'm
sure -- joined in a chorus of ill-informed praise for Chile's
private retirement accounts. (It turns out that Chile's system has
a lot of problems.) Taiwan has more people and a much bigger
economy than Chile, and its experience is a lot more relevant to
America's real problems.
The economic and moral case for health care reform in America,
reform that would make us less different from other advanced
countries, is overwhelming. One of these days we'll realize that
our semiprivatized system isn't just unfair, it's far less
efficient than a straightforward system of guaranteed health
insurance.
November 08, 2005
Feds: Wal-Mart Execs Knew Workers Illegal
"If Wal-Mart were being genuinely abusive, people wouldn't work there."
"[Nat] assume[s] that Wal-Mart is engaged in this kind of behavior as a normal and officially sanctioned part of business, and that simply is not true."
In light of the above comments, (and many others) I thought posting this was appropriate.
November 04, 2005
Brought to you by the Corporation for Public Broadcasting
Considering that we've talked about it before, I thought I'd mention this.
GOP goon and former Corporation for Public Broadcasting Chairman resigns from CPB Board.
November 02, 2005
Judicial Nominee Fight
My father-in-law and I spoke last night about an NPR report we had both heard regarding the tremendous amount of money that was and is being raised on both sides of the Samuel Alito fight. The report cited one conservative group spending over $400,000 on one week of TV ads.
Being reasonably confident that our senators will manage to fight amongst themselves and vote in accordance with their stated views (as we've elected them) for or against the new nominee, should we be spending millions of dollars in this fight?
Should Christians be the first ones to back out of the "politics of power" (father-in-law's term) fight and give the funds to hurricane victims?
Perhaps it is easy to remove myself from this fight, as I am simulataneously prolife and uncomfortable with Alito's stated views on workers' rights and environmental protection.
15 Day Heads Up
With our recent hurricane, and a weekend trip to Maine and drive back, I haven't had internet access. Well, now I do.
The article below is telling. As is this. And this reiteration of previously stated views.
(via Huffington Post)
November 1, 2005
Labor Dept. Is Rebuked Over Pact With Wal-Mart
By STEVEN GREENHOUSE
The Labor Department's inspector general strongly criticized department officials yesterday for "serious breakdowns" in procedures involving an agreement promising Wal-Mart Stores 15 days' notice before labor investigators would inspect its stores for child labor violations.
The report by the inspector general faulted department officials for making "significant concessions" to Wal-Mart, the nation's largest retailer, without obtaining anything in return. The report also criticized department officials for letting Wal-Mart lawyers write substantial parts of the settlement and for leaving the department's own legal division out of the settlement process.
The report said that in granting Wal-Mart the 15-day notice, the Wage and Hour Division violated its own handbook. It added that agreeing to let Wal-Mart jointly develop news releases about the settlement with the department violated Labor Department policies.
The inspector general, Gordon S. Heddell, said the agreement did not violate federal laws or regulations.
The Labor Department reached the settlement in January after finding 85 child labor violations at Wal-Mart stores in Connecticut, New Hampshire and Arkansas, involving workers under 18 who operated dangerous machinery, including cardboard balers and chain saws.
Wal-Mart settled the investigation by agreeing to pay $135,540, but it continued to deny any wrongdoing.
In addition to allowing the 15-day notice, the agreement lets Wal-Mart avoid civil citations and fines if it brings a store into compliance within 10 days of when the department notifies it of a violation.
In exchange for these concessions, the inspector general wrote, there was "little commitment from the employer beyond what it was already doing or required to do by law."
"In our view," the inspector general's office wrote about the Wage and Hour Division, "the Wal-Mart agreement may adversely impact W.H.D.'s authority to conduct future investigations and issue citations or penalty assessments, and potentially restrict information to the public."
Responding to its inspector general, the Labor Department said it "strongly disagrees with the report's overall characterization of the effectiveness of the Wal-Mart child labor settlement agreement."
The department said the inspector general had wrongly given the impression that Wal-Mart had been permitted to avoid all penalties for violations of wage and hour laws by bringing its stores into compliance.
Even though department officials asserted that the agreement was much like that with other companies, Mr. Heddell found that the agreement between Wal-Mart and the Wage and Hour Division "was significantly different from other agreements entered into by W.H.D." and "had the most far-reaching restriction on W.H.D.'s authority to conduct investigations and assess" fines.
Representative George Miller, the California Democrat who asked the inspector general to investigate the settlement, said the report showed that the Bush administration was seeking to do favors for a powerful friend and a major Republican contributor in Wal-Mart.
"The Bush Labor Department chose to do an unprecedented favor for Wal-Mart, despite the fact it is well known for violating labor laws, including child labor laws," Mr. Miller said. "The sweetheart deal put Wal-Mart employees at risk, undermined government effectiveness, and further undermined public confidence that the government is acting on its behalf."
Mr. Heddell said he did not find that the agreement resulted from improper pressures. "Nothing came to our attention indicating evidence of influence or pressure from internal or external sources," he wrote.
Martin Heires, a Wal-Mart spokesman, said, "We think it's important to note that the inspector general's office found that the agreement is in compliance with federal law."
"We continue to believe the agreement was the appropriate course of action," he added. "Our goal remains to make sure that our stores are in full compliance in that our associates are fully informed of all policies, regulations and laws that apply to the employment of workers who are 16 and 17 years of age."
The inspector general recommended that the Wage and Hour Division develop procedures for developing and approving agreements and require that all future settlements be developed in coordination with the department's legal division.
The department said that it had developed a new policy on reaching settlements that, it was confident, would carry out the inspector general's recommendations.
The Labor Department said that the advance notification provisions applied only to child labor matters. But the inspector general voiced concern that "the plain language of the advance notification clause applies to any potential violations, not just child labor violations." Department officials say that giving 15 days' notice helps to ensure that Wal-Mart will come into compliance.
The department denied the inspector general's suggestion that it had consulted with Wal-Mart before issuing a news release on the settlement. The department took the unusual action of announcing the agreement a month after it was signed, doing so only after some details were leaked to a newspaper.
The report said: "The inspector general has specific concerns with the Wal-Mart agreement because it contained significant provisions that were principally authored by Wal-Mart attorneys and never challenged by W.H.D., and because it did not receive adequate W.H.D. review and approval."