Peking Dork
Friday, November 20
  Pandering to union fears
President Obama hasn’t really understood the case for free trade because I don’t think he’s been too interested in trade. His background is as an activist working with the poor people, so he hasn’t thought about these issues. So he ends up listening to other people, and a lot of people who are protectionist are around him, particularly the unions, who are afraid of international competition. But they dress up the fair trade argument in altruism, that they’re doing it to raise the labor standards and wages of workers in India and Brazil and so on and so forth, when in fact, they’re doing it to protect their own workers from competition. The president doesn’t seem to realize that this is something which other people, whom you pretend you’re trying to help, actually see as a naked, cynical ploy.

Instead of pandering to union fear, Obama has got to engage them. You have got to help these doubting Thomases confront their fears. He’s got to say that trade with the poor countries is actually helping, not hurting, you. The unions’ main fear is that unskilled jobs are disappearing. They see these jobs being taken up elsewhere where the labor is cheap. But they can’t hold onto these jobs anyway. What they get in return from trade are cheap products that they need as consumers. So free trade moderates the downward pressure on their real wages.

Big portions of the wages of poor workers go toward low quality textiles, for instance. That is well-established. But if you look at the structure of protectionism, if you go and buy something from Anne Klein that’s going to be expensive, but it carries no tariff at all because these high-end designers compete on variety. Tariffs matter where the competition is on prices. So the low-quality items which poor people buy end up carrying higher tariffs than high-end items that rich people buy.
Jagdish Bhagwati is too optimistic; Obama will continue to pander to union fear.
 
Monday, October 19
  A pale harbinger
ACORN has been in the forefront of those browbeating banks, under the Community Reinvestment Act, to provide housing loans to people who couldn’t afford them. Banks were reluctant to make those loans, of course — until the government stepped in to “guarantee” them. Well, we’ve seen where that ended: we’re all paying the price, especially those who couldn’t afford the homes in the first place, and will be for years to come. ...

But the same something-for-nothing mindset is at work in the health care debate. Here again, many people want more health care than they can afford, which means that someone else will have to pay for it — the government having nothing except what it takes from us. The pretense that it is otherwise — or that they can redistribute more equitably than the market does — is what drives the Dems to their pie-in-the-sky schemes — until some among them realize that it is they and their constituents who are being taken for a ride. At that point, either the recalcitrant are silenced, with some temporary sop, or the bottom falls out of the scheme, which is what many of us are hoping for here. If not, the housing debacle will prove in time to be a pale harbinger of the health care debacle, at least for those who live to see it.
 
Saturday, October 17
  What Mao Zedong actually said
先打弱的,后打强的,你打你的,我打我的。

(First attack the weak areas, then attack strong areas. You fight your [battle], I'll fight mine.)

But you could also interpret it as what Anita Dunn said: "You fight your war, and I'll fight mine."
 
  A plum ambassadorship goes to a supporter, not a diplomat
Joe Andrew, you’re headed to Costa Rica!

More than a year ago, Andrew -- a Hoosier, superdelegate and former leader of the Democratic Parties in both Indiana and DC -- switched from backing then-Sen. Hillary Clinton to then-Sen. Barack Obama just days before the May 6, 2008 Indiana primary.

And this week President Obama nominated his wife, Anne Slaughter Andrew, to be the ambassador to the Republic of Costa Rica.
 
Friday, October 16
  It's OK for males to do perform poorly
NPR interviewed Gail Collins last Tuesday about her book celebrating the increase of working women. Part of the transcript reads:

Ms. COLLINS: The very second that you suddenly got girls going through school and doing better than boys on every level, you instantly started getting all these magazine stories about what's wrong with our boys? We've only got two sexes.

INSKEEP: Somebody has to be in second…

Ms. COLLINS: Society really can't win on this one. You know, somebody is not going to have the majority of college students. But…
So it's OK for males to do perform poorly. Imagine saying something like that about males.
 
Friday, October 9
  James A. McDevitt is an idiot
Last month a federal judge sentenced Rosa Martinez, a physician in Yakima, Washington, to a year's probation and a $1,000 fine for Medicare and Medicaid fraud. The fraud occurred when a physician's assistant in Martinez's practice mistakenly charged the government for her services at the physician's rate, which is allowed only when the supervising physician is present, which Martinez wasn't. She said she was unaware of the rule but accepted responsibility for the errors because they occurred on her watch. The overcharges totaled $22...

The case, launched three years ago by U.S. Attorney James A. McDevitt, stemmed from Martinez's willingness to treat people with histories of illegal drug use for pain, a practice that is not only legal but ethically required. In 2007 a jury acquitted her of prescribing narcotics outside the scope of medicine, failed to reach verdicts on related charges of unlawfully distributing narcotics, and convicted her on eight felony counts of health care fraud. After the trial, Judge Van Sickle dismissed the distribution charges and ordered a new trial on the fraud charges. The Yakima Herald-Republic reports that a medical billing expert hired by Martinez's lawyer "concluded that the convictions were based on misrepresentations by government auditors." According to the lawyer, "it gutted the prosecution's case," which is why McDevitt agreed to a plea bargain instead of retrying Martinez. As for Martinez, she wanted to keep fighting, but she "had run out of money" and assets, having "lost her home in the process of defending herself against the charges."
 
  Obama caves in to the sugar lobby
If Obama wants to stand up to special interests, put money in the pockets of working families and defend American manufacturing jobs, he should order the Department of Agriculture to reconsider its recent decision to uphold the unjust status quo of the sugar program.
 
Tuesday, October 6
  OMG! China doesn't like dorkings!!
If you were going to start a trade war against the United States, it is unlikely that your first salvo would be on chicken parts, or as the Chinese rather charmingly first announced, on dorkings. A dorking is a five toed chicken that flourishes in Surrey, England. The normal chicken has four toes. If you have not heard of dorkings before, you are not the only one.
 
Monday, October 5
  Chinese migrant workers willing to accept lower wages
A short section of an article in the latest issue of the Far Eastern Economic Review which contains the most interesting new information from a study by Stanford University and the Chinese Academy of Sciences (CAS):


‘The survey data show that the initial impact of the crisis was much worse than was previously imagined. Of the 265 million rural-dwellers with off-farm employment, 45 million, or 17%, either lost their jobs or delayed their move out of agriculture between September 2008 and April 2009. The impact was felt more deeply in southern provinces than northern, which was to be expected given the concentration of exporters in the south. Younger workers were hit harder than older workers, perhaps because the experience of older workers made them more valuable and factory owners were more reluctant to let them go. Less educated workers were more likely to lose their jobs than more educated; those educated to primary school or lower were most likely to face unemployment. The impact of the crisis was neutral between men and women, which suggested that the trend toward a higher share of female workers in the off-farm labor force will not be interrupted.

But the results also show that the ability of China’s migrant workers to adapt to the crisis was much better than was previously imagined. By April 2009, the results suggested, 25 million of those rural workers who lost their off-farm jobs had found new employment. By August, that number had increased to 32 million, leaving just 13 million unemployed, or 4.9% of the total off-farm rural labor force.

The results also indicated that the reason for the success of migrant workers in finding new employment was a willingness to accept lower wages. In response to the massive increase in surplus labor, off-farm wages adjusted downwards by about 10%. For China as a whole, that meant a fall from about 850 yuan ($125) per month average off-farm wages in 2008 to about 765 yuan per month in 2009, with a steeper fall from a lower base in the south than in the north. It was not clear whether falling wages resulted from falling hours, falling hourly rates or some combination of the two. But what is clear is that the market for China’s off-farm rural labor is flexible, and wages have adjusted to accommodate the shock from the sharp decline in demand.’

Why no minimum wage? (Ha-ha).
 
Monday, September 28
  Politics as usual
What we have here is a president who views trade policy as nothing more than a tool to advance his own political standing with groups that are hostile to commerce. Since groups on the left have grown disenchanted that some of the most socialist elements of the health care debate might be left on the cutting room floor, why not try to placate them with anti-business, anti-consumer, anti-globalization protectionism? Will makes the link between tire tariffs and the health care debate in his concluding sentence.
 
 

 
  Labor's clout and a mindless adherence to liberal gospel
The New York Post is reporting that unemployment among young workers (aged 16-24, excluding students) has reached a postwar high of 52.2 percent. It had never topped 50 percent before.

A recession is always going to hit the unskilled the hardest, and most of this age group are unskilled. But the increase in the minimum wage on July 24, 2009, adversely impacted this group as well, for it raised the price of unskilled labor by no less than 10.7 percent in the teeth of an already growing unemployment rate. Since 2006, as the seeds of recession were beginning to germinate, the minimum wage has increased by a whopping 40.8 percent. This could only have reduced the demand for unskilled labor. A small-business owner with 10 minimum-wage employees in 2006 could have hired another four with the wage increase he has been forced to pay to the ones he already had. So, of course, many of them didn’t hire anybody.

The evidence that minimum-wage laws work against, not for, the interests of the unskilled is pretty clear. There are, for instance, 13 states, ranging from California to New England, with minimum wages above the federal level. Their unemployment rates among the unskilled average higher than the national unemployment rate. That’s unlikely to be a coincidence.

The biggest backer of a higher minimum wage has long been Big Labor, few of whose workers are paid the minimum wage. But many of their workers are paid wages that are multiples of the minimum wage, so any increase in the minimum boosts their wages as well.

The stimulus bill did nothing for those earning the minimum wage. Had a substantial portion been designated to fund tax relief for employers who added minimum-wage jobs to their payrolls, the unemployment rate would have been immediately impacted for the better by lowering the cost of unskilled labor. Instead, the Obama administration made it harder for employers to hire the unskilled, not easier. Why? First, because Big Labor has enormous clout in this administration; second, because of this administration’s intellectual rigidity and mindless adherence to the gospel of liberalism.


 
  Serves you right!
Vermillion County Prosecutor Nina Alexander victimizes a woman for buying two boxes of cold medication in less than a week, saying "I’m simply enforcing the law", or "I was only following orders". Vigo County Sheriff Jon Marvel agrees:

“Sometimes mistakes happen,” Marvel said. “It’s unfortunate. But for the good of everyone, the law was put into effect.

“I feel for her, but if she could go to one of the area hospitals and see a baby born to a meth-addicted mother …”
 
Sunday, September 27
  We are here to guarantee peace
Claudia Rosett reminds us of Nicolas Sarkozy's remarks at the Security Council meeting. Here's the original French version:
Nous sommes ici pour garantir la paix. Nous avons raison de parler de l’avenir. Mais avant l’avenir, il y a le présent. Et le présent, c’est deux crises nucléaire majeures. Les peuples du monde entier écoutent ce que nous sommes en train de dire. Nos promesses, nos engagements, nos discours. Mais nous vivons dans un monde réel, pas dans un monde virtuel.

Nous disons, il faut réduire. Et le Président Obama a même dit : « Je rêve d’un monde où il n’y en aurait plus. » Et sous nos yeux, deux pays font exactement le contraire, en ce moment. L’Iran a violé depuis 2005 cinq résolutions du Conseil de sécurité. Cinq. Depuis 2005, la communauté internationale a appelé l’Iran pour le dialogue. Une proposition de dialogue en 2005, une proposition de dialogue en 2006, une proposition de dialogue en 2007, une proposition de dialogue en 2008, et une nouvelle en avril 2009. Monsieur le Président Obama, je soutiens la main tendue des Américains. Qu’a amené à la communauté internationale ces propositions de dialogue? Rien. Plus d’uranium enrichi, plus de centrifugeuses, et de surcroît, last but not least, une déclaration des dirigeants iraniens proposant de rayer de la carte un Membre de l’Organisation des Nations Unies. Que faisons-nous? Quelle conclusion tirons-nous? Il y a un moment où les faits sont têtus, et il faudra prendre des décisions. Si nous voulons un monde sans armes nucléaires à l’arrivée, n’acceptons pas la violation des règles internationales. Je comprends parfaitement les positions différentes des uns et des autres. Mais tous nous pouvons être menacés un jour – tous – par un voisin qui se doterait de l’arme nucléaire.
Apparently the French news sites didn't carry this.
 
Friday, September 25
  Obama's plan makes the problems of the current system worse.
With 30 million to 40 million newly insured persons under the administration's plan, aggregate health-care demand will increase significantly. But when demand expands prices increase. We estimate that the higher demand will increase health insurance premiums for the typical family plan by about 10%. Because an employer-sponsored family insurance plan cost $12,680 in 2008, this translates into an increase of about $1,200 in the typical annual premium.

The mandates will also have adverse additional longer-run consequences. According to provisions in both House and Senate bills, mandated plans must have low copayments and provide coverage of health-care services that is at least equal in scope to a typical, current employer-sponsored plan. But these are the very flaws that are responsible for high and rising health-care costs, flaws that stem directly from the misguided tax exclusion for and the extensive state regulation of health insurance. By locking in these flaws, the mandates will inhibit precisely the innovation needed to reform U.S. health care.
 
Thursday, September 24
  American gov't mocked for treating its people as children
Remember when George W. Bush's chief of staff, Andrew Card, claimed that the president saw the American people "as we think about a 10-year-old child"? His comment, understandably, caused much mockery and disdain.

The problem, apparently, wasn't the paternalist sentiment; it was the parent offering it. What we needed was a brainy, grown-up administration to harangue and regulate us into submission.
 
Tuesday, September 22
  Why taxes and regulations are almost always distortionary
According to CARPE DIEM
 
Saturday, September 19
  Protectionist Obama
Obama has largely decided to become a domestic-policy president. His supporters, his base and the politicking of his underlings indicate things will only get worse. With the global economy in deep crisis, protectionism is a terrible way to build a recovery.
 
Thursday, September 17
  I hope this is wrong
...domestic political considerations and the good opinion of his base are more important to Obama than just about any other concern. That seems to be the motivating factor in a lot of what he does. The international apology tour is catnip for his Left-leaning academic friends, who are delighted that we finally have a president who “understands” there isn’t anything special about America. He unleashes another investigation on CIA operatives, cheering the “get the Bushies” netroot crowd. He selects an entirely mediocre Supreme Court judge because the Hispanic vote could use a boost. And despite what must be the advice of free-traders within his administration, he has no qualms about risking economic retaliation from China to mollify his Big Labor patrons.

During the campaign, Obama’s supporters assured us that Obama was intensely “practical” and therefore would make fact-based decisions devoid of ideology. The reality is that he persistently tends to the whims and demands of his Left-leaning base (whose views he, in any case, sympathizes with), the result being a series of policy choices that send a thrill up the legs of union bosses and Harvard professors. If we trigger a trade war or throw the intelligence community into a tailspin, well, that’s a small price for keeping the base quiet.
But it's a convincing argument.
 
Sunday, September 13
  Norman Borlaug
In a just world, people like Borlaug would be the subject of hours of media commentary and coverage and special commemorative issues of Time or Newsweek while politicians got a cursory obit notice on the back page of the local rag.
Not to mention princesses and pop stars.
 

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