January 18, 2010

If an insurance company is not allowed to factor in risk but instead is forced to cover everyone, regardless of physical condition, and charge them all the same rates, it ceases to function as an insurance company. Instead, it becomes a government-directed utility that just pays people’s medical bills. This is not really any different from government-run health care; it just uses private companies to administer the benefits. This is the point made by Charles Krauthammer:

By essentially abolishing medical underwriting (actuarially based risk assessment) and replacing it with government fiat, Obamacare turns the health insurance companies into utilities, their every significant move dictated by government regulators. The public option was a sideshow. As many on the right have long been arguing, and as the more astute on the left (such as The New Yorker's James Surowiecki) understand, Obamacare is government health care by proxy, single-payer through a facade of nominally “private” insurers.

Perhaps that’s what we want. If so, we might as well just adopt a nationalized one-payer system and cut out the middle-man.

via Charles Krauthammer – One year out: President Obama’s fall – washingtonpost.com.

December 30, 2009

Here are the top news stories of 2009 according to an Associated Press poll of the nation’s newspaper editors and news directors:

1. THE ECONOMY: Despite a $787 billion federal stimulus package, much of the U.S. economy continued to sputter throughout the year. The jobless rate topped 10 percent, scores of banks failed, the federal deficit tripled to a record $1.4 trillion, and stocks fell to their lowest levels since 1997 before rallying. Yet investment banks’ profits surged, triggering public anger and efforts in Washington to crack down on Wall Street bonuses.

2. OBAMA INAUGURATION: Inauguration Day in January was a moving moment for many Americans, as the nation’s first black president took the oath of office. But Obama soon confronted the sobering realities of governing as he struggled to get the economy back on track and win support for his ambitious legislative priorities.

3. HEALTH CARE: A sweeping overhaul of the U.S. health care system, extending coverage to millions of Americans now without it, was a top priority for Obama and majority Democrats in Congress. But Republicans were almost unanimously opposed, leading to complex, bitterly partisan showdowns in both chambers.

4. AUTO INDUSTRY: It was an immensely challenging year for America’s Big Three automakers. General Motors and Chrysler filed for bankruptcy, GM’s CEO Rick Wagoner was ousted by the government, and Chrysler was pressured into an alliance with Italy’s Fiat. Ford avoided bankruptcy, but its worldwide sales — like its competitors’ — fell sharply.

5. SWINE FLU: Swine flu struck tens of millions of people worldwide, worrying governments as supplies of vaccine failed to meet demand. In the United States, according to federal authorities, swine flu sickened an estimated 50 million people, hospitalized close to 200,000 and killed 10,000.

6. AFGHANISTAN: Casualties on all sides mounted as U.S. forces, with their Afghan and NATO allies, battled the resilient Taliban. President Obama, after lengthy deliberations, opted to send 30,000 more troops. His decision was complicated by the disputed Afghan election, which prompted allegations of widespread fraud but resulted in President Hamid Karzai taking office for a second five-year term.

7. MICHAEL JACKSON DIES: The “King of Pop” died at the age of 50, triggering grief and nostalgia among his legions of fans around the world. His doctor became the focus of a Los Angeles police homicide investigation after telling investigators he administered propofol, a powerful operating room anesthetic, to help the pop star sleep.

8. FORT HOOD RAMPAGE: An Army psychiatrist, Maj. Nidal Hasan, was accused of killing 13 people at Fort Hood, a sprawling military base in Texas, before being seriously wounded by police gun fire. Investigations were launched to determine if authorities missed warning signs that might have prevented the rampage.

9. EDWARD KENNEDY DIES: Sen. Edward Kennedy, who carried on the family legacy after the deaths of his three older brothers, died of brain cancer after a distinctive political career filled with highs and lows. Though his own presidential aspirations were thwarted, he earned bipartisan respect for decades of hard work in the Senate.

10. MIRACLE ON HUDSON: A US Airways passenger jet, both its engines disabled, made an emergency ditching in the Hudson River, and all 155 on board survived in what was dubbed “The Miracle on the Hudson.” The veteran pilot, Chesley Sullenberger, was hailed as a hero for averting a disaster.

What ones would you leave out and what would you replace them with? Are there any other events of the past year that were especially notable or significant?

May 18, 2009

So when Fiat owns Chrysler, does that mean that if I want to buy American, I can’t buy a Plymouth?

February 16, 2009

Congress has passed the stimulus package. The Washington Post notes that it is much larger than Roosevelt’s attempt to pull us out of the Depression:

The New Deal of the 1930s equaled no more than 2 percent of the nation’s gross domestic product. The new legislation represents over 5 percent and is probably no more than an opening bid — Obama and his congressional allies will next turn to the foreclosure crisis, the reform of financial markets and an overhaul of federal budget practices.

One of the most liberal Democrats in Congress celebrated the victory of his ideology:

“I think we need to appreciate that the bill is the largest change in domestic policy since the 1930s,” said House Appropriations Committee Chairman David R. Obey (D-Wis.).

Comments the Post: “The legislation represents the start of a new ideological era that places the federal government at the center of the nation’s economic recovery.”

The era of small government, such as it was, is over. Big government is back with a vengeance.

We are in uncharted waters. Worries about deficits assume old-school economics. We are embracing “fiat money,” assuming that since value is relative and arbitrary we need no gold standard or now even labor standards; rather, the state can impose the value of our medium of exchange as an act of power. (Note the postmodernism of all of this: What we have done to truth we are now doing to economics.)

Will this work to restore prosperity, or will the iron laws of economics in all of their objective truth assert themselves? We’ll see.

December 9, 2008

As part of their bailout plan for the U.S. auto industry, Congress was going to set up a board of its members and other federal officials to tell the companies what they can and cannot do. That was bad enough. Now Congress is planning to appoint a single individual to oversee the auto industry, a so-called “car czar.” From the Washington Post:

Democratic leaders continued working on details of their proposal this morning, and they made at least one change at the administration’s request. Instead of establishing a board from among six federal agencies to oversee an auto industry restructuring, Democrats agreed to the appointment by President Bush of a single “car czar,” according to a senior Democratic aide, who spoke on condition of anonymity because the measure is not yet final.

Under the proposal, which Democrats hope to bring to a vote this week, the loans would go out on Dec. 15, and the car czar would then develop broad restructuring goals for the auto industry, the aide said. On Feb. 15, after the Bush appointee had been replaced by President-elect Barack Obama, the czar would assess the companies’ progress and could pull back the loans. Long-term restructuring goals would be due from the car companies by March 31.

Friends, is it right for the state to issue fiats to privately-owned companies? Is it good economic policy to run a company according to government commands rather than the private market? I know, this is the price of a government bailout. But this cannot be worth it. This is not just socialism; it’s national socialism.

April 15, 2008

George F. Will gives useful background on the worldview that looms behind Barack Obama’s contention that Americans are religious, love guns, and want border control because they are economically oppressed. A sample:

The emblematic book of the new liberalism was “The Affluent Society” by Harvard economist John Kenneth Galbraith. He argued that the power of advertising to manipulate the bovine public is so powerful that the law of supply and demand has been vitiated. Manufacturers can manufacture in the American herd whatever demand the manufacturers want to supply. Because the manipulable masses are easily given a “false consciousness” (another category, like religion as the “opiate” of the suffering masses, that liberalism appropriated from Marxism), four things follow:

First, the consent of the governed, when their behavior is governed by their false consciousnesses, is unimportant. Second, the public requires the supervision of a progressive elite which, somehow emancipated from false consciousness, can engineer true consciousness. Third, because consciousness is a reflection of social conditions, true consciousness is engineered by progressive social reforms. Fourth, because people in the grip of false consciousness cannot be expected to demand or even consent to such reforms, those reforms usually must be imposed, for example, by judicial fiats.

According to Marxism and its neo-Marxist descendents (who apply what Marx said about ecoonomics to other kinds of oppression, such as by race, gender, and sexual orientation), “false consciousness” has to do with the oppressed being manipulated by those in power to co-operate in their own oppression. For example, in neo-Marxist literary criticism (still a big deal on non-Patrick Henry university campuses), Jane Austen is said to show “false consciousness” by having her female characters get married rather than empowering them to be feminists.

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