We're spending more on health care because we want to

Veterinary spending is subject to few of the perversities that either left or right suppose to be the main problems afflicting health care spending. Consumers pay full frieght most of the time. They are price sensitive, and will let the patient die if keeping him alive costs too much. There is no adverse selection. There is no free riding on mandatory care. Government regulation is minimal. Malpractice suits are minimal, and have low payouts. So why is vet spending rising along with human spending?

Two reasons, presumably: technological change and rising income. As we get wealthier, we spend more of our income on former luxuries, like keeping our pets healthy--nineteenth century veterinary care for sick cats consisted of a sack and some stones to weight it down with.

Maybe he should read the constitution

President Obama has declared that [the Honduran] "coup" was illegal. But if he had read the Honduran constitution--or even been provided with a brief analysis of the document's details--it seems unlikely he could maintain such a firm conclusion.

Stimulus not working yet? It's not Obama's fault.

[Every anti-recession program in the postwar era] invariably impacted on the economy too late to really help. There were many reasons for this. First, economists were slow to see a recession coming and often didn't see one at all until we were already well into it.

Then it took time to convince policymakers to do something and get legislation enacted. By the time a countercyclical program was signed into law, the recession was always over. Consequently, the stimulus stimulated when the economy was already on the upswing. The result was that these programs stimulated inflation more than they stimulated jobs and growth.

GM--How will taxpayers ever break even?

The Obama administration's pre-packaged bankruptcy plan for General Motors is a recipe for disaster. Even if President Obama were sincere in his claim that he doesn't want to run a car company, it will be impossible for him to eschew policies that distinctly benefit GM. With taxpayers on the hook for $50 billion (just for starters), the administration will do whatever it takes to demonstrate the wisdom of its intervention.

That will require, at a minimum, a positive return on the coerced investment. But to merely break even on taxpayers' 60% stake, GM will have to be worth $83 billion (60% of $83 billion is $50 billion). How and when will that ever happen? At its peak in 2000, GM's value (based on its market capitalization) stood at $60 billion. Thus, the minimum benchmark for "success" will require a 38% increase in GM's value from where it was in the heady days of 2000, when Americans were purchasing 16 million vehicles per year. U.S. demand projections for the next few years come in at around 10 million vehicles. Taxpayer ownership of GM is something we should all get used to, and the "investment" is only going to grow larger. Think Amtrak.

Drinking water can kill

But instead we hear about the dangers from bisphenol A, even though

You would have to drink 1000 liters of bottled water a day to approach Canada’s provisional tolerable daily intake for the chemical bisphenol A, according to the latest research by Health Canada. (Not only is this practically impossible, rapid consumption of even six or seven liters of water in the space of a few hours could kill you, a rather dramatic illustration of the principle that anything can be poisonous if consumed in large enough quantities).

Counterproductive regulation

Treating all consumers as hapless victims rather than recognizing that many consumers rationally respond to incentives is a recipe for unintended consequences. It can lead to counterproductive regulation that makes loans more expensive and harder to get.

The Case for Doing Nothing

The first thing to note about the financial crisis is that the federal government never had any business intervening in the personal decision of whether you want to own a home. There is no rational economic argument, or any argument I know of, that says the market of buying and selling homes is imperfect in some way, requiring government action.

and

Bailouts took money from the taxpayers and gave it to banks that willingly, knowingly, and repeatedly took huge amounts of risk, hoping they’d get bailed out by everyone else. It clearly was an unfair transfer of funds.

and

The problem isn’t only that the bailout wasn’t necessary in the first place. The bailout may have made the credit situation worse. When banks hear that the Treasury Department is dangling hundreds of billions of dollars out there to purchase their toxic assets, what are they going to do? Sell their assets for 20 cents on the dollar, or hold onto them in the hope that the government will eventually buy them for 80 cents on the dollar?

and

President Obama’s mortgage plan uses $275 billion in tax funds to help homeowners refinance and lower rates, to subsidize payments from borrowers to lenders, to get lenders to modify loans, and so on. It gives another $200 billion to the government-created home mortgage companies Fannie Mae and Freddie Mac. This is exactly the wrong approach.

The aim is to reduce foreclosures, so the delinquent or nearly delinquent borrowers can stay in their homes. That sounds like a laudable goal, but it ignores a fundamental reality: This money is coming from somebody else. So what the plan is doing is penalizing relatively responsible homeowners or renters—everybody who pays taxes—and rewarding those people who should have known, or at least should have had some inkling, that the loans they were being offered were too good to be true. This program creates exactly the wrong incentives for people deciding whether to borrow and whether to be homeowners.

More generally, it continues the policy of promoting homeownership. We got in this situation because the government wanted to promote homeownership. Until we create a situation where people make decisions based on their own resources and have to think about bearing the consequences of the decisions they make, the root cause of the financial crisis will only get worse.

...

Add in Obama’s $787 billion stimulus and his $3.6 trillion budget, and a picture emerges of an administration totally unapologetic about its designs to expand the size and scope of government. There is no question that the people advocating this spending want much more government intervention with respect to unions, energy, health care, infrastructure, and other areas. The crisis has given them the opportunity to ram through a bunch of things they’ve been pursuing for a long time.

Finally,

The stunning thing about Obama’s spending proposals is that there’s almost nothing you could defend from the perspective of efficiency. It’s all about redistribution--not redistribution to the poor but redistribution to Democratic interest groups: to unions, to the green lobby, to the health care industry, and so on. At some point these everescalating government interventions will affect the size of the economic pie.

And yet so many are still in love with him.

Boycott GM

Boycott GM until the government relinquishes its grip on the company’s decision making process.

If you believe the U.S. House of Representatives

That is, the U.S. House of Representatives Committee on Oversight and Government Reform:

The housing bubble that burst in 2007 and led to a financial crisis can be traced back to federal government intervention in the U.S. housing market intended to help provide homeownership opportunities for more Americans. This intervention began with two government-backed corporations, Fannie Mae and Freddie Mac, which privatized their profits but socialized their risks, creating powerful incentives for them to act recklessly and exposing taxpayers to tremendous losses. Government intervention also created “affordable” but dangerous lending policies which encouraged lower down payments, looser underwriting standards and higher leverage.

Finally, government intervention created a nexus of vested interests – politicians, lenders and lobbyists – who profited from the “affordable” housing market and acted to kill reforms. In the short run, this government intervention was successful in its stated goal – raising the national homeownership rate. However, the ultimate effect was to create a mortgage tsunami that wrought devastation on the American people and economy. While government intervention was not the sole cause of the financial crisis, its role was significant and has received too little attention.

via CARPE DIEM

I wondered why that house was empty for so long

Kerry L. Smith, 37, of Carbondale has been sentenced to more than seven years in prison on federal marijuana conspiracy and other charges.

Smith was sentenced in U.S. District Court in East St. Louis to 92 months in prison and four years supervised release. He also was ordered to pay $41,802 in restitution to the Social Security Administration and the Illinois Department of Human Services, according to a news release from A. Courtney Cox, U.S. attorney for the Southern District of Illinois.

Additionally, Smith was ordered to forfeit seven Carbondale residences, two vehicles, $10,576 cash and other property. To wit:

• 111 South Dixon Avenue
• 309 South Crestview
• 313 Crestview Lane
• 501 East Snider Street
• 1005 E Cindy Street
• 1808 West Freeman St
• 403 North University Avenue

Please verify your password?

I posted this question to Yahoo answers, and after no one was able to help me, they deleted it.

Please verify your password?
When I try to access my account, I get prompted to "Please verify your password" every time I enter my password using Firefox, IExplorer, and Chrome...again & again & again. I've tried changing the password, deleting cookies, restarting my computer. I may never use my yahoo mail account again.

Rarely does anyone weigh facts before deciding what to believe

Rarely do any of us sit down before a table of facts, weigh them pro and con, and choose the most logical and rational explanation, regardless of what we previously believed. Most of us, most of the time, come to our beliefs for a variety of reasons having little to do with empirical evidence and logical reasoning. Rather, such variables as genetic predisposition, parental predilection, sibling influence, peer pressure, educational experience and life impressions all shape the personality preferences that, in conjunction with numerous social and cultural influences, lead us to our beliefs. We then sort through the body of data and select those that most confirm what we already believe, and ignore or rationalize away those that do not.

A victory for public health?

The legislation happens to make it more difficult for tobacco companies to market smokeless alternatives to cigarettes that are far less lethal because they contain fewer carcinogens than cigarettes and don't enter the lungs. And while reducing the tar or nicotine content of an individual cigarette might make it "safer," it will also induce some people to smoke more to achieve the same fix -- the same way people often compensate for lower-calorie foods by eating larger servings.

Then there's the bill's exemption for menthol from the ban on flavored tobacco products. Menthol happens to be the most popular cigarette flavor, and the Journal reports that the Congressional Black Caucus pressed for the carve-out. Menthol brands account for less than 30% of the U.S. market but are favored by 75% of black smokers. Black public health officials understandably have opposed the exemptions. But black lawmakers apparently believe that banning an unhealthy product used by a disproportionate number of black voters is the greater evil.

What's also clear is that prohibiting menthol would especially hurt Lorillard, the top menthol cigarette maker, and Philip Morris, whose Marlboro Menthol is the second-leading menthol brand after Newport.

A victory for politics as usual.

Politics as usual = shooting oneself in the foot

The Pay Czar and Compensation Issues--Posner's Comment

[General Motors and Chrysler] are fast-failing firms that need to be able to offer high salaries to attract able executives. Between efforts by the "pay czar" to limit these companies' flexibility in compensation, and the efforts by Congress to limit the companies' ability to import vehicles and close plants and dealerships, the government is doing to best to minimize its chances of ever recovering its $60 billion investment in the two firms. This is called shooting oneself in the foot, or, alternatively, politics as usual.

...

Any monkeying by government with compensation practices, especially below the top level of management and especially in financial firms, will impair the ability of American firms to compete with foreign firms. The banking business is thoroughly international, and unless all countries act in lock step with the United States in regulating compensation practices, many of our ablest financiers will be lured to foreign banks.

United States, Banana Republic

The United States' economy will regain the world's confidence when its government (first Bush, now Obama) stops behaving like a banana republic.

When it behaves responsibly in fiscal affairs. When it ceases to print currency without a parallel increase in production. When it no longer interferes in the market with arbitrary rescue operations to bail out companies, like General Motors, that are condemned to disappear because of the rejection of consumers, the pigheadedness of labor unions, and the insensitive stupidity of management.

To paraphrase the Chinese, this (should) "hurt the feelings of the American people." And like those many things that "hurt the feelings of the Chinese people", too bad it's true.

Why not start with Medicare?

Medicare is a huge, single-payer, government-run program. It ought to provide the perfect environment for experimentation. If more-efficient government management can slash health-care costs by addressing all these problems, why not start with Medicare? Let's see what "better management" looks like applied to Medicare before we roll it out to the rest of the country.

But instead,

a report that claims that Medicare is wasting 30 percent of its spending thinks it's making a case for making the rest of the health care system more like Medicare.

Obama's administration’s stimulus program is an obstacle to sound policy

Independent central banks don’t do what this Fed has done. They leave such fiscal action to the legislative branch. By that same token, Mr. Volcker’s Fed had to avoid financing the large (for that time) Reagan budget deficits to be able to bring down inflation. The central bank was made independent expressly so that it could refuse to finance deficits. But is there a political consensus that the much larger Obama deficits will not pressure the Fed to expand reserves to buy Treasury bonds?

It doesn’t help that the administration’s stimulus program is an obstacle to sound policy. It will create jobs at the cost of an enormous increase in the government debt that has to be financed. And it does very little to increase productivity, which is the main engine of economic growth.

Indeed, big, heavily subsidized programs are rarely good for productivity. Better health care adds to the public’s sense of well-being, but it adds only a little to productivity. Subsidizing cleaner energy projects can produce jobs, but it doesn’t add much to national productivity. Meanwhile, higher carbon tax rates increase production costs and prices but do not increase productivity. All these actions can slow productive investment and the economy’s underlying growth rate, which, in turn, increases the inflation rate.

The end result? Inflation.

We should look instead at...the gross domestic product deflator. In this year’s first quarter, it rose 2.9 percent — a sure sign of inflation.

Besides, no country facing enormous budget deficits, rapid growth in the money supply and the prospect of a sustained currency devaluation as we are has ever experienced deflation. These factors are harbingers of inflation.

When will it come? Surely not right away. But sooner or later, we will see the Fed, under pressure from Congress, the administration and business, try to prevent interest rates from increasing. The proponents of lower rates will point to the unemployment numbers and the slow recovery. That’s why the Fed must start to demonstrate the kind of courage and independence it has not recently shown.

Milton Friedman often said that “inflation was always and everywhere a monetary phenomenon.” The members of the Federal Reserve seem to dismiss this theory because they concentrate excessively on the near term and almost never discuss the medium- and long-term consequences of their actions. That’s a big error. They need to think past current political pressures and unemployment rates. For the next few years, they cannot neglect rising inflation.

The theater of thoughtfulness

The theater of thoughtfulness is critical to the president's success. He has the knack of appearing moderate while acting radical, which is a lethal skill.

A liberal: one who is exceptionally generous with other people’s money

President Obama, in this case, is exemplifying the present-day definition of a liberal: one who is exceptionally generous with other people’s money. He used our money — the American people’s money — to buy into Chrysler (as well as GM and many banks) and is now attempting to restructure those companies. In the process, he is trying to bully other companies and groups to play along with his plan for their money, as well.

This runs the risk of bringing a classic quote to life: Margaret Thatcher’s declaration that “the problem with socialism is that you eventually run out of other people’s money.”

It's not just how small Obama’s spending cuts are

Look at the proposed budget.