So I was looking at the election results (*sigh* American politics...), to see how Oregon's ballot initiatives ended up, and took a gander at the other states' initiatives, as well.

One of the... what I'd consider odd... amendments up for consideration to a number of the state constitutions was a constitutional right to hunt and fish. Anyone here in one of those states, who can clue me in on what was driving those amendments? It can't possibly be knee-jerk "oh noes... Obama's gunna take our gunz," is it?

Reactionary? Never! Especially not this amendment passed in Oklahoma:

Ballot initiatives are a terrible feature of our political system, and I think everyone would be better off if they didn't exist. Sometimes they're stupid but relatively harmless like the ones you and Bitt have pointed out, but more often than not, they allow voters to do stupid thing and hamstring elected officials who know more about the long-term consequences than the uninformed electorate does.

Of course, a bigger problem than ballot initiatives is the ridiculously high number of elected officials we have. States don't need bicameral legislatures, and we don't need nearly as many elected officials at the state/local levels. We also shouldn't have any elected judges -- they should all be appointed by the chief executive at the proper levels. Having all these elections for comptroller, registrar of wills, and dog catcher just leads to voters voting for people they know nothing about based on party affiliation, yard sign counts, etc.

Oh, and "There are too many states, please eliminate 3, PS, I am not a crackpot."

I saw that one, too. It makes the American half of me embarrassed to be American. Now... had it been written so as to forbid courts from considering, or using "religious canon or law," I could get behind it. Were I an Oklahoman after this election, I'd put in a ballot initiative forbidding courts from considering Catholic canon.

Well, sometimes that's the goal behind those who sponsor the initiative, whose goals are opposed to the elected officials.

I like that initiatives allow the public to (attempt to) institute changes that elected officials wouldn't normally touch with a ten foot pole, such as legalizing medical marijuana. On the other hand, "majority rules" decisions can all too easily be used to deprive certain segments of the population of rights they ought to have the freedom to enjoy. Yin and yang.

Except that when a bad decision is made by a legislature, you know who to blame, because either your guy voted for or against the thing you wanted or didn't want. There's no way to boot out the entire electorate when they do something stupid, but you can send your legislator packing. Of course, incumbents usually win no matter how awful they are, and yes, the replacement legislator is probably shitty, too, but at least there's something motivating the guy to do the right thing by his constituents, even if it's just so he can keep his job.

Relatedly, there was a ballot initiative in North Carolina to amend the NC Constitution to deny anyone ever convicted of any felony the ability to run for sheriff.

So much for having paid your debt to society.

It passed something like 85-15.

This is why we need to not have hoi polloi making legislation. It's just reactionism. I'm sure that most of those people got to the poll and saw that for the first time, and said, "Yeah, we don' need no crimmunuls as shurrif," thus denying people who were once convicted of or pled no-contest to, for example, pointing a laser at an airplane are no longer eligible to run for sheriff.

In terms of the electoral results themselves, I think there was going to be some reversion of seats from D to R no matter what was accomplished in the 111th congress. Some of the seats the Dems picked up in the 2008 wave were going to be difficult/impossible to keep without resorting to extreme levels of pandering to the conservative tilt of those districts.

Still, the magnitude of the shift is notable, and I hope it makes Democrats seriously consider whether they might try to be more like, um, Democrats to turn out their base. I don't actually expect this to happen, because, well, they're Democrats, but right now, ideological coherence within the party is higher than it was with all those Blue Dogs and New Democrats in deeply red districts and states. That's a tremendous opportunity to show a consistent message and stay on it until 2012, which will drive turnout of the Democratic base voters that got them elected in 2006 and 2008.

I think it's rather curious how the GOP strategy of creating an "alternative" sub-party paid off this time. So that voters could vote GOP while simultaneously pretending not to.

-ml

Well, the GOP didn't really create the Tea Party, they just commandeered it when it became useful to them. The "Tea Party" as we know it today has its roots in various factions of libertarianism that, at the time they were founded, wouldn't have anything to do with the mainstream GOP. But, just like their godfather Ron Paul, they soon found it was convenient to partner with the GOP in the same way a tapeworm partners with its host organism. The GOP gets their astroturf-y populist group that people can feel good about voting for, and the tea partiers get millions of dollars for negative ads without having to personally whore themselves out to big business (or in some cases, in addition to whoring themselves out to big business.)

This has brought the tea partiers a good measure of electoral success despite the fact that many of their views would prevent them from winning a primary election in most states, much less a general. Of course, now that they're in, I reckon the old guard Republicans will be enforcing some party discipline, meaning that any of them that still thinks they'll be cutting Medicare or Social Security will quickly find themselves eating lunch alone and trying to win elections without the giant piles of corporate cash. Either that, or a civil war will break out, but the tea partiers are small enough in number that I think any insurrection will be quashed pretty quickly. I'm curious to see what happens to these bombastic tea partiers once they get in. My prediction is that most of them will morph into garden-variety Republicans, a few will stir the pot a bit, but ultimately, there will still be near-100% ideological purity within the GOP caucus and almost no split votes on any bills of substance.

That's certainly the back story that's always been promoted to the press.

Brilliant, I suppose, given how effectively it appears to have worked.

It does look brilliant when you just look at the results, but all it really boils down to is big money. The GOP basically initiated a hostile takeover of the tea party movement by injecting millions and millions of dollars to fund groups that co-opted the tea party message and smoothed out some of the rough spots. Without big money from Karl Rove, Dick Armey, and The Koch Brothers, the tea party is still a bunch of Ron Paul goldbug types holding rallies and backing libertarian candidates who get 2% of the vote.

Now, were those big money boys "brilliant" in recognizing the fact that the tea party could be useful to them? I don't know. There are many obvious natural synergies between the tea party types and establishment GOP ideals, and most of the tea partiers are disaffected Republicans to begin with. So I'll give them credit for recognizing the state of play and making bold, decisive moves to bring those guys back into the GOP tent, but I think calling it brilliant might be giving them too much credit.

Interesting article someone linked on Facebook.

http://thebusysignal.com/2010/11/03/the-loss-of-russ-feingold-lamentable-and-shameful/

This is why I don't follow politics too closely. Stories like this help to show how reactionary most of the voting population is, and low little research most do into the candidates. "(R)? Oh, thats good, I'll vote for him, even though that (D) guy actually was voting for limited government and the other core values I claim to support..." *sigh*

It's true, though. There was no "Tea Party" at first. What happened was after the nearly $2T in bailouts and "stimulus", people started getting together literally at tea parties (where you drink tea) to bitch about the situation together and as homage to the Boston Tea Party. It took off like wildfire and started to look like a movement, but it was decentralized. Then the Republicans started pandering to this group to bolster their ranks. That scummy bit did work rather effectively.

Libertarians have flown the Gadsden Flag ("Don't Tread on Me!") for many years, but unfortunately now it's become a symbol of the far right. As my good friend once said about the stars & stripes when *everyone* put them on their vehicle after 9/11, "every time someone does that, it makes the symbol less significant". Well said.

What's eating him? Doesn't he believe in The Power of Pride?

Holy cow, was I wrong on this one! It turns out that the tea partiers are abandoning their principles and adopting standard GOP doubletalk on spending before they arrive in Washington:

Dr. Rand Paul, Revolutionary Outsider (February)

Senator-elect Rand Paul, now:


I'm actually a bit conflicted on this, because I actually agree with Paul's statement that spending earmarks are mostly symbolic, being such a small portion of our overall spending. Then again, I didn't run a senatorial campaign explicitly opposed to earmarks.

All politicians are hypocrites, but this may just take the cake as one of the most brazenly hypocritical about-faces I've seen in a long time.

When is this pony show supposed to end by the way? I'm tired of the US dollar being in the toilet (lately). The way it's dipped seems to be related to the elections and it's disheartening to see that the more US money I accumulate, the lower the rate goes.

It is the stated policy of the Fed to continue to devalue the US currency to attempt to bolster exports. Another $600-900B in devaluation was announced last week, the day after the elections, in the form of monetizing debt. Don't expect the dollar to improve in the near future. Because it solely controls the international reserve currency, the US can spread their economic trouble all over the world by devaluing the dollar, and they've done this to an astonishing degree. They seem to intend to continue until it collapses.

At last there is starting to be recognition that worthless fiat currency is not an answer to anything, and that central-bank caused inflation is a way of stealing from people, as you say in your post. Inflation steals from savings. What's needed is a hard currency beyond the grasp of a ruling class, greedy bankers, and corrupt politicians.

The inflation rate is near historic lows. Deflation is a much more urgent and potentially corrosive risk to our economy when unemployment is near ten percent. The latest round of quantitative easing was widely expected, and thus already priced into the markets.

We're a lot closer to 1990s Japan than we are to present day Zimbabwe. There have been many times in our history to worry about inflation, but now is not one of them.

They tried the gold standard in the depression and that didn't work out so well. Government and currency are too intertwined to seperate. There is no such thing as a currency with intrinisic value because without government the only thing with intrinsic value is food and guns/bullets.

I think Libertarians and Socialists can agree that this is pretty funny.

It looks like we've got at least one incoming GOP freshman who's, shall we say, off message.

I was thinking about this sort of thing last night, while I was waiting in line at the grocery checkout. The person in front of me was using food stamps, and the first thought that popped into my mind was "you know... if the Republican voter base is okay with using my tax money to pay for their wars, then I really have no problem using their tax money to pay for my health care and her groceries."

My second thought, after watching her swipe her card through the card reader 8 times, each time with a different orientation (including mag-stripe up and away from the reader) was "Wow... she's not very bright."

Especially considering how one in four Americans is enrolled in a federal food program.

But, hey, these people are all just leeches who are buying T-bone steaks using funds confiscated from our society's true wealth producers. If we'd just leave their income alone, I'm sure they'd handle the "food security" situation through charitable giving.

A friend of my wife just had her second kid on our tax dollars. Her “Baby Daddy” doesn’t want to marry her because he would have to put her on his insurance and the cost would go up. She would also not get her food stamps and other public food and health assistance since he makes about $60k a year.

If he did marry her he might have to cancel one of his hunting trips or fishing trips to a sporting resort.

Not everyone on food stamps is stupid. Some are quite smart about the system.

That there are unethical people who take advantage of government programs is not in dispute. The fact that you know a couple who's making a convenient financial decision for them that may skirt the intent of government assistance* doesn't really address the question of whether providing the assistance in the first place is in our nation's interest, even if it's not optimally efficient.

Of course, we also know that there are unethical people at higher income levels who abuse the system by taking advantage of tax loopholes, and that because of their disproportionate share of wealth, their negative impact on the government's bottom line is much higher than the amount of fraud in our entitlement programs.

The fact is, with 10% unemployment, a lot of people are going to need assistance. Many of them truly need the assistance, and even if the couple you know doesn't need it, they're clearly spending their money on other things, whereas a CEO who gets a tax break is just going to park money in savings right now, which will do nothing to stimulate the economy. Even if 90% of the food assistance in this country was totally fraudulent, it would still be a good thing for our economy, which has a lot of idle resources due to high unemployment and excess production capacity.

* Of course, I'm not conceding this point without knowing more about their situation than his income and some anecdotes about how he spends his leisure time.

tl;dr version: "The plural of 'anecdote' is not 'data'."

The problem is two fold:

«» Stealing from the government (and to a lesser degree big business) is not considered bad and not considered to hurt anyone.
«» In many cases there is no positive or negative motivation to remove yourself, or your family, from pubic assistance.

Coming from a poor background I have more instances of people happily living well off welfare and cheating the system than I do of people that are really in need. I can only think of one instance where a family used welfare when they needed it and then got off the dime. Even in that situation they could have survived without it by say: canceling their $70 a month cable TV and cutting back. I have even known people to quit their jobs so they could get on public assistance because they didn’t want to work anymore.

A gradually diminishing assistance program would really help to get the slackers motivated. The truly unable to work should be thoroughly screened. Getting one doctor to sign a paper saying you have ADD and can not work is not a ticket to live off the government for the rest of your life (another antidotal example from my experience).

I have rarely seen anyone in true need. The one’s that are in true need on streets usually have some major mental health or addiction issues and refuse help.

This is a complex issue but should not be rocket science. You would think the government could do a better job at monitoring and handing out the cash. I’m sure they’ll do a great job with they new healthcare they will be administering, not.

I think I get what you're driving at, but to me, the extent to which that statement is true depends greatly on what the "stealing" looks like, and who's doing the looking. Conservatives generally concern themselves with people who steal from the expense side of the ledger by abusing government programs, whereas liberals generally have a bigger problem with those who don't pay their fair share into the system, whether that's through tax fraud or judicious use of legal loopholes in the tax code. Of course, a dollar of lost revenue and a dollar of wasted spending are both the same in economic terms, so the idea that one or the other is a greater sin is purely based on political prejudice.

It's also important to note that in both cases, there are gray areas around whether the fraud actually violates the letter of the law, or just the spirit and intended purpose of the law. Your example couple, at least from the information you've put forth, is probably not among the most needy families to be drawing food and/or income assistance, but I have little doubt they qualify under the letter of the law for those programs. Compare their actions to the thousands of businesses and millions of individuals who do everything they can to minimize their tax burden using legal loopholes. Nobody wants to pay more in taxes than they are legally obligated to, so why wouldn't someone who qualifies for assistance take it provided they meet legal eligibility requirements?



That really depends on the individual program. Clinton's 1996 welfare reform imposed strict restrictions on welfare (TANF, formerly AFDC) benefits, including a hard 60 month cap on lifetime benefits and strictly-enforced work requirements for recipients. These led to the number of AFDC/TANF recipients shrinking from ~12 million in 1996 to ~4 million in 2007.

Other programs like SNAP (food stamps) impose fewer restrictions, but I don't think the average SNAP recipient's monthly income of $640 or average monthly food stamp benefit per household of $227 would be considered living high on the hog.


Your anecdotes don't change the fact that the average benefit per recipient of these programs is very small, and the total expenditures is just a drop in the bucket. The total size of the SNAP food stamp program is around $30 billion a year. Last year, we lost twice that in tax revenues to companies who shifted income around to avoid taxation, $3.1 billion that just from Google. When you consider that there are many other forms of legal tax evasion other than income shifting, you realize that the amount of legalized fraud on the income side of the ledger likely matches or exceeds that of those who are abusing government programs. Yet I don't see conservatives/tea partiers campaigning for stricter enforcement of our tax code to make sure companies pay their fair share.



Well, most of the provisions of "Obamacare" have not yet taken effect, but we're already seeing benefits from the few that have. For instance, more small businesses are offering health insurance this year due to a tax credit in the healthcare law. Furthermore, at a time when 20-somethings are having trouble finding jobs, kids up to age 27 can now remain on their parents policies instead of having to go to an emergency room where you and I would pay much more for their care. And it's not like there's any single payer system or public option, so I'm not sure what exactly you're worried about here.

I love the benefits so far. Next year my monthly premiums are going up 300% while my copays are increasing by between 200% and 1000%. They are increasing more the year after. Yay benefits!

Of course they are. The health insurance industry spent $86 million telling everyone how awful the bill would be, so it would be foolish to not get some return on their brainwashing investmentby jacking up rates. Don't let any crisis go to waste, right?

Your specific situation is atypical: market research suggests the average premium increase this year will be 8.8%, up from 6.9% last year. Of that 8.8% , only 1-2% can be directly attributed to provisions of the new law. (source)

It isn't the insurance company that is increasing the rates, it is my employer. Having between 150k-175k employees qualify for the Cadillac Tax would be a crazy hit on the bottom line that isn't really feasible in the current market where other companies in the same field are shedding employees and decimating internal budgets to try to make ends meet.

The so-called Cadillac tax (40% excise tax on insurance plans that cost more than $27,500 annually) doesn't kick in until 2018. Why would it be affecting your employer's costs now?

They said they were going to start increasing the costs for us now so it doesn't all hit at once. We already know that our plans are going to increase cost for two years, but don't know anything after that.

Part of it is trying to decrease their bill, of course. They are using the tax as an excuse for the tiered approach, though.

You would agree, then, that the 40% tax is ridiculous, just that it hasn't started yet? Probably not, I suppose, but that's not my point anyway.

We need to stop putting the "funding" for these programs in the future. Our country has over $50 trillion in unfunded liabilities because of this kind of thinking. Eventually those chickens come home to roost, and the best intentions of everyone to have these social programs eventually come against the reality of limited resources, made all the worse by the debt we've accumulated to put the problem into the future. Not to mention the incompetence, corruption and waste of governments.

Anyone who thinks this is going to cut costs is living in a different world than me. The TSA hasn't even existed for 10 years, and already there is corruption, vast excess, and egregious infringement on civil rights. The TSA position is that we "surrender our rights when we buy a ticket", but this is a complete misunderstanding of a "right". One can not be compelled to surrender their "right", or it is not a right in the first place. Rights, properly understood, are prior to laws, which exist to protect them. Not the other way around.

Certain individuals may pay less for health care (even large numbers of them), but the society overall will pay vastly more, and probably each individual will as well when you consider taxes they will pay for other things will increase. As Margaret Thatcher is credited with saying, "The problem with socialism is that eventually you run out of other people's money." If you aren't paying for it, someone is. That can't last forever with something that everyone, eventually, will need.

No. $27,500 is more than about 30% of the households in the US earn.

And the 40% tax is on the amount over that limit.

And people in dangerous occupations where there's a reason for high premiums (cops, firemen, etc.) are exempted.

Who decides whether this is excessive? A tyranny of democratic majority? Our system isn't supposed to work like that. It's supposed to protect minorities against the majority. Isn't how much to pay for your health insurance an individual choice? It is my money, after all. OK, not really, not any more, but it's supposed to be!

I'm back working in a field that pays fairly well, and I certainly have an option to opt for one of these "Cadillac" plans (look at the emotional rhetoric used!), but it's not given to me. I have 3 options or something, and the company pays a certain amount. I pick which of the 3 I want, and pay the difference above the company subsidized portion from my paycheck. It's been this way everywhere I've worked.

You know what will happen, of course. The "rich" people will have their compensation restructured to have a $27,500 health insurance allowance, exactly, and the balance will be given in other compensation to avoid the tax. Regardless of whether it's "fair", it won't work. It won't raise any money, because high-income employees will have their comp restructured. Happens all the time. If that doesn't work, they'll just opt for health insurance that costs $27,500 and relinquish the extra benefits, taking the balance in cash compensation. So we'll have another government liability that is going to result in a big deficit because how they intend to pay for it is naive, dishonest and stupid.

We saw a similar thing happen with the fuel economy mandates. Auto makers were required to get their average fuel economy up, and luxury cars were dragging down the average. Knowing that the American consumer was still going to demand a large vehicle, the manufacturers exploited a loophole that excluded trucks from the mandate, and the big luxury vehicles were all suddenly SUVs. The regulation *caused* the SUV craze because it changed the economics rather than what people actually wanted (which was big vehicles). These unintended consequences happen all the time, and the end result is that government grows, the regulation accomplishes little, except to make it more difficult to produce goods because of the cost of compliance.

Which, FWIW, is not in the law or coined by anyone in politics.


Which will be taxed at a normal rate, as opposed to the 0% tax that currently exists on health care benefits.

Let's look at the numbers directly. $40,000 was a number thrown about as the annual premium on a top-of-the line plan (the plan offered to some banking CEO, IIRC). A 40% tax on the amount over $27,500 is $5000. A $5000 tax on $40,000 is 12.5%, which sounds perfectly reasonable to me, especially for someone who is likely to be well within the top percentile of wage earners, and is almost certainly below the income tax rate they would be paying on that same income.

Also, part of the point is to get people to move from these plans to other forms of compensation. For the most part, these plans are seen as tax dodges with very little additional health-care benefit.

I know it sounds reasonable to you, but who decides where to draw this line? That's my fundamental objection to the whole thing. It's the majority imposing their will on a minority. We tend to think that's ok when the minority happens to be wealthy and have something we want. So, we take it by force. You may consider that justified in this situation, but you have to acknowledge that's what's happening here.

But we can't just keep going back to that well, or we run out of spending their money. Besides, being wealthy shouldn't be discouraged, and it certainly shouldn't mean that property rights don't apply to you. What we need in the world is more wealthy people, not fewer, since wealth is fundamentally created by production. We need more people in the world participating in that.

Your argument ultimately boils down to "no one should have to pay taxes", as any form of the government taking your money is going to be a "where do we draw the line" argument.

And that is an insane position.

Okay, to be less glib:

Should people pay taxes? At what level? Should government services be based on tax revenue or vice versa?

Should people at all income levels be taxed at the same rate?

From a different perspective, should health insurance be taxed at all? Should it be taxed at the same rate?

That's not really what I'm saying, but I'm not sure it's insane anyway.

This discussion can't occur without talking about the services themselves. I contend that government is the least efficient way to deliver services, and should only be used as an absolute last resort and to the absolute minimum extent. The goal should be to minimize the involuntary seizing of people's property to the maximum possible extent, not discuss what level is "fair".

So what is the minimum required services? Those needed to provide rule of law (protection of life, liberty and property) and common goods that are impossible to provide in any other way (such as defense). Yes, I realize that the common good thing is a slippery slope.

So, to answer directly:

Should people pay taxes? Only where it is absolutely necessary to protect life, liberty and property, and never at the disproportionate expense of other people's life, liberty and property.

At what level? Always at the absolute minimum possible level.

Should government services be based on tax revenue or vice versa? The service comes first, assuming it is justified within those very strict criteria, then the necessary revenue collected. However, the service should meet the requirement of being absolutely necessary and impossible to provide another way. I am advocating the ABSOLUTE MINIMUM GOVERNMENT POSSIBLE, just like our Founding Fathers did in the USA.

Should people at all income levels be taxed at the same rate? I don't care. The government our Founders had in mind, a Libertarian Republic, could be funded easily by small import duties, use fees, or whatever. Income tax is a tiny fraction of our government budget even today. As Ron Paul likes to point out, if we went back to the size of government in 2000, we could eliminate the income tax entirely.

Should health insurance be taxed at all/at the same rate? No. A Libertarian Republic, which our system is supposed to be, does not engage in central planning which uses tax code to encourage certain choices by citizens (whether to buy health insurance and what kind). A Libertarian Republic allows people to make these decisions as they see fit, without reward or punishment by the central planners.

Now, clearly this is my opinion. And I know we disagree on this point. You are a central planner: one who sees the role of government to make life better for everyone. I am a classic liberal, who sees making life better as *necessarily* up to the individual, because they have to define for themselves what "better" means. The role of government, in my opinion, is to maximize the freedom of individuals to the maximum possible extent in pursuing those goals. While we disagree, it is very clear that the founders of our system were much more aligned with my view. They were very outspoken in their opposition to things like a central bank, fiat money, taxation, all of which required constitutional amendments to make happen.

I also think you're very smart, and I like you, so none of this is personal for me. You have legitimate concerns and I agree with most of them. I just don't think the government can solve these things, and they have demonstrated that repeatedly throughout history. Government is not to be trusted. It is dishonest, corrupt, greedy, and self-serving. Our system acknowledges this, and was intended to keep the influence of government as small as possible.

Consider our current predicament -- the near destruction of the financial system (which may yet occur). What almost nobody will admit is this was entirely caused by government interference. Government agencies recklessly pumped money into the economy for the benefit of their cronies on Wall Street and at the behest of politicians who saw easy re-election during the boom. The inevitable bust was someone else's problem. Most importantly, this boom would not have been possible with a legitimate ("hard"), commodity-based money. Central, fractional-reserve banking (another creation of the government) caused this crisis. Greedy people in the free market did what any rational person would do when offered essentially free money -- they borrowed and speculated. But the government itself created the conditions that allowed this to occur. Now people think we need more regulation to stop this kind of thing. Insanity! What we need is an objective standard for currency, completely beyond the power of politicians and Wall Street cronies. The Founding Fathers warned us about central banking, because they had seen this all before.

That's just one of hundreds of examples, though it's probably the most poignant one because it's going to land this country, and possibly the entire Western world in a gigantic depression.

Edit: PS, free markets are greedy too. The problem with greedy governments is there is no alternative. The market mechanism provides alternatives. I'm not talking about the crony capitalism we've had for at least 100 years. I'm talking about a actual free market.

Your ideal world is one in which people die on a regular basis due to preventable ailments, and the fortunate ones that survive are run roughshod over by amoral corporations that have millions of times more money than any individual.

Effectively, your ideal world is one in which companies replace government. Yes, government may be inefficient and corrupt, but I greatly prefer that to an equivalent entity that's efficient at its goals, which are the very things that in government we call corrupt. At least the government is supposed to be helping. The only thing a company is there to do is make money.

That's not a world I want to live in.

Some specific points:

Would your ideal government be in the business of issuing currency at all? I'm guessing not, and that we'd all be trading gold coins. Except that's a pain in the ass. So a bank would come along and offer to deal with your money for you, and people could trade their promissory notes. Then the bank realizes that, hey, we've got all this gold here, and not all of the people want their gold coins all at the same time; let's do something with that. So they start lending. Pretty soon, they've loaned over half of their gold coins, but things are going well, and it's all coming back in. Then a disaster occurs. Could be a huge storm, or a terrorist attack, or any number of things well outside the control of the bank, its depositors, or its borrowers. Suddenly a lot of the depositors need their gold back to pay for things related to the disaster. At the same time, the borrowers are defaulting on their loans, for the same reason that people need their coins back. All of a sudden, all of that house of cards of money that the bank "created" through lending more than it really had comes crashing down.

How is this situation different from your idea of how a government controlled fractional-reserve bank works? Well, other than the obvious part about how the government's not involved and therefore not requiring that the bank keep at least a certain percentage of cash on hand.

The traditional libertarian argument is "well, those depositors were stupid to deposit their money in a bank with such bad practices". Well, guess what? All the banks were doing that. And that assumes that everyone has a solid knowledge of relatively advanced economic issues. In other words, in your language, "perfect knowledge" is a crock.

Also, I guess, Alexander Hamilton doesn't count as a Founding Father.

I understand this is your fear, but I don't believe it is the case. As a matter of fact, governments have killed more people than religion, and ours is no exception. I contend that the costs for preventable ailments will fall dramatically were government regulation and prohibition to stop, and there is historical evidence for this. Meanwhile, the only thing that has increased life expectancies and improved the welfare of humanity at large is industrialization and innovation which has resulted in the very treatments you want to make available to everyone at no charge. People working for a profit motive, attempting to create something of value for humanity. Governments do not create anything. Enterprise creates wealth.



Now we're hard against it. You have an extreme anti-capitalist bias, and I believe this is based on a lack of understanding of money and profit and production of wealth in general. Yes, companies exist to make a profit. You consider that an evil motivation because you don't seem to understand where profits come from, which is wealth creation. Wealth is not just out there in the universe, waiting for us to divide it up. Wealth is created by labor, which turns raw materials into usable things. The things are the wealth, not the money. The money is simply the medium of exchange. Same goes for informational or financial products. The companies make profit by creating something of value that people voluntarily pay for. Through this mechanism, the wealth of humanity is increased by production. No creation of usable products, no revenues, and no profits. Profits are the measure of how efficiently people create things that society wants.

In our world of crony capitalism, we don't let the markets operate so well, and the health care bill is a perfect example of this. Rather than competing on the basis of delivering superior products and services at lower prices, companies now compete using special interest groups to get a regulatory advantage that effectively closes the market to competition or choice by consumers. Sometimes this is called regulatory lock, and indeed, the profits that come from this are immoral, because they are not based on the free choice of customers and a fair valuation of the worth of the product. Health insurance companies were behind Obamacare because it requires every citizen (under pain of taxation, which the government will collect at gunpoint if necessary) to purchase health insurance. No matter how expensive or shitty the product, we need to purchase it. Those profits are definitely ill-gotten, but that's not because capitalism is bad, companies are evil, or the market doesn't work, it's precisely because those things are not allowed to operate.





We disagree, of course. The problem is the doomsday scenario you describe is not accurate, because your premises are not sound. You blame free markets and capitalism for problems that are more often than not caused by government.



It is not necessary for the government to issue currency, and gold can be traded electronically in arbitrarily small (or large) amounts. There is absolutely nothing less convenient about a system based by a hard commodity. All of our electronic banking conveniences would still work. In fact, there is nothing special about gold. The ONLY thing that using gold money does is make the total amount of money a relatively fixed quantity -- beyond the reach of politicians to inflate it, thus stealing from savers. Any relatively stable commodity can be used. The point is that it is an objective, non-fluctuating, medium of exchange.



It's not different at all. It's stealing. That's precisely what fractional-reserve banking is, whether a dishonest bank does it or the government. It's also something that could be regulated and managed (a legitimate case of regulation as it serves to protect property).



That's not the traditional libertarian argument at all. The argument is that lending out property placed on deposit in your warehouse is stealing. The banks violated the contract with the depositor when they lent out his money. With a 100% reserve system, which would prevent all of these problems, including the asset bubbles we've seen, a bank is nothing more than a warehouse for your money. The paper deposit certificate is a warehouse receipt. For convenience, and to avoid the impractical nature of using gold coin for everything, you and I can exchange our receipts with each other, rather than the actual commodity. Those receipts could be electronic.

We have warehouse companies today that store extremely valuable things and they do it without stealing them. This is another common scare tactic argument that has no real basis. What actually causes bank runs is when the government allows fractional reserve banking to happen in the first place, to inflate the currency to pay for its unfunded liabilities. Then the scenario you outlined happens. It's not corrupt companies that cause it, it's inflationary government monetary policy.



Almost any modern libertarian, including myself, would support a Hamilton-style central bank, because it was exactly what I'm talking about. He explicitly forbade the bank to buy government debt (a terrible sign for a country, and which just happened in the US the day after our elections), and he required 100% capitalization. In fact, his bank was established explicitly to get rid of fiat currency then in circulation.

Our objection is what inevitably happens afterward. Now in possession of the money supply, there is a relatively low barrier for the government to start using that money on deposit for its special projects. The government is the organization most likely to create the doomsday scenario you describe, and they are doing it. Please put aside your prejudice against capitalism long enough to look at what they're doing!

First, you bring up religion and I have no idea why.

I do not have an anti-capitalist bias. I have an anti-laissez-faire bias. I also think that there are certain things that the government should provide if at all possible. These things, to me, provide liberty. I understand your argument that taxation is a removal of liberty, and I agree. But I think it's less egregious than the ones caused by poverty. I also think that the benefits from reducing poverty are far greater than the benefits of letting the rich get richer.

First, the idea that government-run business cannot make wealth is absurd. The TVA is a great example. Not only did its direct employment keep people off of welfare, its public works created a huge amount of wealth and laid the groundwork for even more.

Second, you use the loaded term "evil" where I said "amoral". Businesses as entities are amoral. Their sole goal is to profit. They may create wealth as a means or as a side effect, but this is not required by the nature of business. See Enron.

You're going to have to define "crony capitalism" for me.


HAHAhahaHahaha! Haha! HA! Ha.

Oh, wait. You're serious.

Um, you're going to have to provide some evidence that this is the case.


Uh, allow? Now you want the government interfering? What happened to the free market?

The banks aren't stealing your money. It said right in the contract that the depositors signed with the bank that they would leverage your money and that there were risks involved.

Are you saying that the government should actively disallow people from entering into contracts with their bank?


I think your facts about the First Bank are somewhat questionable. The Bank acquired its money by selling $10 million of stock in itself. 20% of that was purchased by the Federal Government using money loaned from the Bank itself. The rest of it was sold to the public, requiring only 25% hard currency, the rest of it fiat, bonds, or whatever. Interestingly, 25% of 80% is 20% of the whole. So what really happened is that the Bank took $2 million in hard currency from the public and immediately loaned it to the Federal Government, while claiming that they still had $8 million, which was all in fiat currency, and then still lent money up to the $10 million total, less the amount loaned to the Federal Government.

How, exactly, does this jibe with your idea of how a bank should work?

This is the bit about gold-standard currencies that I don't understand. You and I agree that the total amount of wealth in the world steadily goes up, as people and industries become more productive. But if the total money supply is fixed to the total gold supply, which is essentially fixed (give or take the small amount of "new" gold mined each year), then the money supply as a fraction of all wealth must steadily decrease.

Eventually there's (say) twice as much wealth in the world, but still only the same amount of gold. Doesn't that mean that one gram of gold now buys you twice as much stuff, in other words that prices expressed in terms of a quantity of gold, will have halved? I don't see how a fixed-commodity currency can do other than cause long-term deflation, and deflation is very damaging to investment and production, as it becomes more economically sensible to hold on to gold than to invest it in new enterprises.

Put differently, if the money supply is constrained, the laws of supply and demand tell us that its price goes up. So if a ton of grain used to buy a gram of gold, eventually two tons will buy a gram of gold. That is, the gold currency has deflated.

Clearly a fiat currency is a temptation to governments to print too much money and cause inflation. But the reason they need to be printing extra money in the first place, is to stave off deflation.

Peter

I just wanted to chime in and say that I'm thoroughly enjoying this conversation even if I'm not contributing

To that end, I'll put in some of my feelings about government, some more related to this conversation than others:

-I don't know how you can consider banks "stealing" money by using it for investments- it's not like people don't realized this is what the bank is going to do when they make a deposit. Short of the government prohibiting this practice, it isn't going away, and why would the government step in and tell people what they can't do like that? The "warehouse" type bank will have to charge customers to hold their money- I think most people will be willing to allow the banks to use their money in order to gain interest and not be charged for the warehousing.

-While creating wealth and free market tend to be closely aligned, they are not in lock step. There ARE professions that can generate money without creating wealth. Professional gamblers (to pick a profession close toe hime), for instance. A gambler does not add anything to society except for providing people the entertainment value of losing money to him; he merely redistributes the medium of exchange to be in his favor (assuming he is good at it). Just because self interested people tend to create wealth does NOT mean that EVERYTHING that a person might to do out of self interest will benefit the common good.

-People tend to be motivated by self interest, which is why harnessing that tendency can benefit the whole of society. That doesn't, however, mean unfettered free market leads to the best possible society. Rather, it seems better to me to promote self interest competition where it benefits society and enacting restrictions where it is harmful. The problem, of course, is that there is a ton of disagreement over what is beneficial and what is harmful.

-I personally falter when it comes to certain policies that intellectually make sense to me for the betterment of society, but end up harming individuals in order to serve the greater good. It's quite easy to talk about things at a high level, but if I had to be the one to deliver the bad news to someone that they cannot get what they need because of a greater good policy, I don't know that I could do it- and if I support those policies but would be unwilling to enact them myself, I feel like that makes me a coward and is my problem with a lot of conservative politics (I'm not a liberal- but I don't really think I'm conservative politically anymore either).

-I DO think the government is too big and spends too much money on stuff it ought not to (and I'd bet a lot of people would agree); the problem is that we don't agree on what areas to cut.

-Health care in its current state is broken. As someone who has a wife with a disability that requires thousands of dollars worth of medications per year, I can't believe how ridiculous the system is. I don't like the government getting involved, but something's got to give.

After living outside the US for a bit, I've observed that decent quality private health care can be done much more inexpensively than it is being done in the US. Perhaps in addition to a public option, it's not a bad idea to figure out why a 'majority-world' country like Belize can have good private hospitals and medications at a fraction of the cost. Obviously, doctors and nurses make less here, but not enough to account for the disparity.

I'd like to add a few anecdotes of my own here. They don't offer any ideas for solutions, but they support what you said.

Three years ago when I was visiting here in Ajijic, Mexico, I had an insect bite on my arm. It itched, I scratched it and broke the skin, and the next morning my arm was pink from wrist to elbow. I went to the local clinic (a small, 8-bed hospital with, I believe, one full-time doctor) without an appointment or any advance notice. I had to wait eight whole minutes before I finally got to see the doctor. He looked at my arm, looked where I scratched the bug bite, said "Yes, it's infected, this prescription will take care of it." It did. The bill was 200 pesos, about $15 US. The prescription was about $16 at the pharmacy across the street. I learned later that I could have gone a quarter mile down the road to the less "fancy" pharmacy and gotten it for $12. Next morning the arm looked no better, so I went back, was told that it would take another day for the antibiotics to knock down the infection, and he was right. He refused to accept any more payment "You've already paid," he said. He asked me to stop by the clinic one more time before I left, just be sure everything was OK. I did, everything was OK, and I had to force him to take a second $15 payment. Now, if this experience had taken place in my home town of Fairbanks, Alaska, I would have gone to the clinic (easily 20 times the size and staff of the one in Ajijic) and been told that yes, I could have an appointment, how about a week from this Tuesday. Had I still been alive then, I'd have shown up on time, and waited at least 45 minutes to an hour to see the doctor, who would have looked at my arm and said "Yes, it's infected, but we'd better run some tests to be sure." After $600 worth of tests he would have written up about $200 worth of prescriptions. The 10 minutes of actual visit time would have cost another $135, ditto for any followups. The same service in the US would have cost about 20 times as much as I paid in Ajijic (30 times as much if I hadn't insisted on making that second payment) with highly qualified doctors in each instance.

Second anecdote: Now that I have permanent residence here, we have set up a plan with a different clinic wherein for a flat fee of about $225 for each of us my wife and I have unlimited office visits for one year plus two home visits from the doctor. These doctors are not rustic witch doctors making sacrifices to the gods or anything like that. They are trained in the medical schools of Guadalajara which are recognized as being among the finest in the world. This is not to say that all services are covered by that $225. Things like MRIs and cat scans cost extra. SWMBO had an MRI of her sinuses at the request of her allergist, and the cost was something around $150.

The third anecdote is not first person, but taken from a local newspaper. A local man became hypoglycemic and passed out in the dining room of a hotel. The management called an ambulance which transported him to a hospital about 30 miles away where he was held 24 hours for observation. The hospital made accommodations so that his wife could stay in the room with him. The doctor assigned to him visited him several times, and nurses checked on him every hour. When he was released, he was presented with a bill for $400.

My wife and I have found the medical services here to be so good and so inexpensive that we don't submit the bills to our insurance company. When she was still working in California, she went to Guadalajara for dental work (two tooth implants) and the cost including the round trip plane tickets was less than her insurance co-pay would have been had she done the work in California. This was before we realized that our retirement insurance actually was valid in Mexico. It's too late now for getting the dental work paid for, and the other bills are so small as to discourage fighting with the insurance company for reimbursement, because the paperwork provided by Mexican clinics is...informal at best.

When I look at the cost and quality of Mexican health care compared to the US, I can only assume that someone in the US is making a great deal of profit.

tanstaafl.

My experiences in Taiwan pretty much mirror yours in Mexico. They also have all the cutting edge equipment. Coming back to the US kind of felt like going back to stone age medicine, for an astronomical price.

There's a lot of clinics in Taiwan open 24 hours, no waiting for the docs to roll out of bed if you're sick at night.

I'm convinced we have the worst health care system of any country that actually has one...

I'll reply at length tomorrow, but first a clarification. When I said the insurance companies where "behind" Obamacare, I meant they supported it, not that they instigated it. There was an excellent PBS Frontline (not exactly Fox News!) about how Obama made a secret deal very early with the leader of the insurance lobby to basically buy them off so they wouldn't oppose. The price? A mandate that every American buy insurance. It's disgusting, and certainly not "change I can believe in". It's also a perfect example of so-called crony capitalism, which I'll elaborate on when I have more time. In the meantime, try to find that Frontline episode.

Jim

My experiences are completely different here. I haven't had to wait more than 24 hours for any non-emergency appointments (I haven't had anything qualifying as an emergency to compare). When my orthopedic doctor wanted MRIs of my knees, I had an appointment within the hour. The cost of that was $10 (for a scan on both knees, so it took a while).

Overall, I have no complaints about the care I receive. But, I guess my plan is atypical (hence the increases).

For the record, I have no problem paying taxes. I don't go through and figure out how much I need to donate to charity to drop me down a bracket or anything, I pay what I end up owing. Maybe it is because I grew up in the military and realize that those taxes are partially being used for folks like my parents. Maybe it is because I'm not smart enough to care about it. What does bother me is when people say that the health care plan won't affect me since I'm already covered and then getting hit with increases like we are.

One of the ways many ways in which the system is broken isn't at all about the quality of care we've recieved, but how insurance drives people to be less selective about the care they obtain. Doctors prescribe medication and people get it without asking any questions. People don't take ownership over this stuff, and the result is spending without regard for who is paying (ultimately, it's us, but it's deferred in the form of rising rates).

My wife and I just got forced into a high deductable plan, and this, at least, feels like a step in the right direction. Most people end up having to pay for their basic medical needs (and therefore have to be responsible with their spending), while serious medical issues are handled. Of course for us, we hit outlr high deductible early in the year so it's not much different for us in practice than our PPO was, but almost everyone else I know is having to be more responsible with their medical expenditures. My company also gives us 1K into a HSA every year so most employees don't end up shelling out for medical stuff as long as they are careful and ask questions when doctors star prescribing expensive medication. I'm sure this is playing right into the evil insurance companies desires, but I have to say it feels like movement in the right direction. Of course, it seems from talking with friends and family, our plan is better than most high deductible plans, so I count myself blessed.

We still have to wait for hours sometimes to see certain doctors, and one of my wife's doctors told her she can no longer be a patient at her practice after she showed up to two appointments 15 minutes late (first one due to an appointment with a different doctor she had scheduled earlier in the day keeping her in the waiting room for an hour and a half, and the second due to bad traffic). It's a wonderful double standard these doctors have.

I haven't had a chance to watch it yet, but it's called "Obama's Deal", and it's available online.


The lobby is not the industry, and the industry certainly spent huge amounts of money convincing the American public that this was a terrible idea.


I understand your problem with this, but the only way that this has a chance of reducing health care costs is if everyone has health insurance. I'd personally prefer it if the government provided basic healthcare insurance as part of being a US citizen, with private expanded coverage available at cost. My point is that, assuming he wasn't going to push for single-payer health care, which he probably wasn't, as it's politically unfeasible, he made a deal by giving them something he was already going to do.

If you limit "most people" to being the relatively wealthy (you and me and above), I won't (in theory) disagree, but those are the people I'm least concerned with.

The working class and below can't afford maintenance health care now, and that's one of the things that is driving costs up.And the lack of insurance drives people to be far more selective than they should be.

That said, I can't come up with a reasonable set of things for a high deductible to apply to. Certainly regular office visits should be exempted. Despite your implication otherwise, I don't think that doctors arbitrarily prescribe unneeded medications, and the costs there are very high, so it doesn't really make sense from either side. I haven't really thought about it, but maybe a system where the second thousand dollars is out of pocket, or something like that, might make sense, but I still disagree in my gut.

That happens quite a bit, actually. You would be amazed at some of the kickbacks doctors are offered from drug companies for prescription numbers. Hell, not even the kickbacks but just the dinners that are thrown (I was in awe when my father was describing them) to talk about what drugs are available. Of course, not all doctors go for that. My doctor regularly loads patients up with the sample packs when the drug is needed and the sample is available.

My current plan is exaclty that- the first 1K is payed for and the next 2K is on us. After that everything is covered. Most people don't make it past the first 1K if they are selective about their doctors, where they get prescriptions filled, etc.

By "most people", I mean the majority of the people on this plan.

I don't think doctors are nefarious- it's a complicated system and they have little motivation to find the most cost effective treatments. I've definitely had doctors prescribe us some very expensive medication when other medication would do- often the insurance company pushes back, which DOES end up with a more cost efficient treatment, but meanwhile the patient is caught in the middle waiting for the treatment while the doctor and insurance get their ducks in a row.

How many people do you know that factor in price when picking a pharmacy? I don't know of anyone who does, yet they do not all charge the same. When consumers become responsible for the choices they make, they will start making better choices.

Only because of the HSA, which is not part of the insurance, and which would not be included in the plans of the less well-off, which is to whom, IME, most of these high-deductible plans are being pushed.

I understand that. Most people I know who have a high-deductible plan do NOT have the HSA and it is a lot more painful for them, so I'm under no illusions that my situation is typical. I know I have it good.

I am largely uninformed about what is being pushed to whom, so I'm not making a political statement here or saying that high-deductible plans are the answer to anything. The extent of my point is that I see good things coming out of this system and people who are on it making better choices.It feels less broken than my previous health care plan and therefore a step in the right direction.

How long does that usually take? I get knee injections twice a year that takes less than a week to get authorized (I don't know how the cost of those compare to your costs, though).

No, the cost to you was $10. You can bet that the clinic running the MRI machine received at least $1,000, more likely $2,000 for the procedure.

tanstaafl.

We haven't had too many problems with the big operations. My Wife's pain doctor is pretty aware in advance of what issues may arise with the insurance. In fact, with her current pain doctor we haven't had too many problems at all- but with previous doctors my wife would get a pain prescription and at the point of getting it filled we get push back so we have to call the doctor (who has gone home for the evening). Even if it takes an evening to get things resolved, I get the choice of just paying myself or watching my wife cry in pain while this stuff gets worked out. Usually it's the former, I'll admit.

Just to say what I might not have said earlier a little more clearly: as long as insurance means "I play a $15 co-pay and I get to see whatever doctor I want (in my network) and I pay $10 and get any drug I want" you do not have incentives for doctors and pharmacies to compete on price. Ultimately the consumer DOES pay, but the effect (rising health care costs) is removed from the cause (I used expansive services and treatments) and you are a slave to the choices of those whom share your plan- even if you do use a cheaper pharmacy, if everyone else goes the expensive route your premiums will get higher.

And these rising costs DO effect those without insurance because those prices are being set to cater to those with insurance (though often doctors have different prices for those without insurance).

Or at least I assume that's the way it works. I have no direct knowledge- it just seems to me that in a system where the consumer does not make choices based on price those setting the prices are free to jack them as high as they can.

You know your country's health care system sucks when other countries can promote medical tourism.

Around here, the hospitals get really full from about Oct - April or so because of all the folks who migrate south from Canada for the winter. A lot of that is for elective stuff that is cheaper here than they can get it back home.

That's not the same as medical tourism, though, where the express purpose of the travel is to have medical procedures done. If those snowbirds weren't already traveling to/living in the US, and paying for an American health insurance policy, do you really think they'd come just for the elective stuff? I seriously doubt it; I know I sure wouldn't. That's not to say that there aren't problems with the Canadian system -- there are. But I've said it before, and I'll say it again... I'd rather be faced with those problems, than the problems in the US system.

*sigh*

Look at this thread. All I wanted to know was whether or not all the constitutional amendments adding rights to hunt and fish were knee-jerk reactions to something...

We routinely get 45 min. consults with the doctor for the same price as our $30 copay was in the US. And he's not in a hurry. He's willing to listen to all of our concerns and explain to us his opinion on each of them. Quite refreshing really.

I believe each of our ultrasounds for our baby cost $50. Same equipment we had at our state of the art OB in Chandler, AZ. One of the big reasons we decided to have the baby here. Cost less than a fifth of what the first one cost in the US.

I'm pretty sure that I've had prescriptions where the pharmacy charged more than the insurance company would allow and I got stuck with the overage. It's pretty rare, though. More common, in my experience, is where the cost is actually below my plan's copay and I get it cheaper.

But you're right, I don't do pharmacy comparison shopping. At the same time, I don't really have a good way to. It's not like I ever really see the final cost at all, from either the pharmacy or the insurance company. I think that if I ask for a report from the pharmacy it will show me the actual final cost, but I'm not even sure of that.

Free here, but £3 if you want a copy of the scan to take home.

Free Free, or Government-subsidized free? Likely the latter.

To everyone who posts their healthcare costs after insurance or government subsidizing: stop and think real hard for a minute. This is not the same You can't compare these when talking about inexpensive healthcare unless you include what the insurance company or government is paying too. Now stop thinking and go back to your regularly scheduled activities.

In the particular case of ultrasounds, you probably can't compare it even then; procedures that aren't treatments in themselves but which can stave off big-ticket medical complications further down the line, could believably be provided for free even if profit were the only motive.

Peter

Don't lose sight of the fact that we pay more taxes than any country with national health care. We just don't get anything we want for those taxes...

Incredibly, my health insurance company (and perhaps others?) specifically excludes coverage for preventative care.

At first I thought this was financial lunacy on the part of the insurance company, but then my skepticism kicked in and I thought that it might be to their advantage to have sick (i.e., expensive) people die quickly before they ran up too many bills.

tanstaafl.

Good point. I've never heard of anyone actually doing it though (not that that means anything). Probably place too much of a premium on the technician's time. Of course ultrasounds can also be diagnostic, as in the case of my wife's kidney stones (also $50).