Monday, January 10, 2005

Hope for peace in the Middle East

Abu Mazen has won the Palestinian election.

Here's hoping that he is more sincere about making peace than Arafat was. What gives me hope is that he promised a better life for the Palestinian people. I can't recall Arafat ever talking about how to make the lives of Palestinians better. When was his speech on education? There never was one. How about how to care for the poor? He never talked about that either.

Arafat was 100% a soldier. All he knew was war. I think the biggest reason he walked away from a peace deal in 2000 was that he couldn't deal with the idea that he would have to go from warrior to statesman.

Sunday, January 09, 2005

Sudan genocide

If you want to know the latest news about the Sudan genocide, there is no better resource in the blogoshpere than Passion of the Present

The weak response from the world's powers is pathetic and cowardly. We said "never again" after the Holocaust, yet we keep on letting it happen. Again. And again. What is the UN for if not to stop this kind of barbarity?

Michael Savage- ugh

What an embarassment to conservatives. Check this out.

Friday, January 07, 2005

The 2% solution- Part four

Okay, so far Matt Miller's gone over health care and education. What's the next step? A living wage. Now for me this is kind of a personal issue because I've lived with low wages most of my life. Only in the last two years have I become what you'd call a member of the middle class. So when I hear ivory tower pundits talking about "living wages" they are usually talking about what they think is a decent life, not what us working stiffs see as a decent life. Now us working stiffs aren't likely to complain about people wanting us to have more money, but we should. Because those well-meaning advocates end up doing things that hurt us more than help us much of the time.

I favor the minimum wage. Does it cost jobs? Probably. But reasonable increases in prosperous times tend to cause little impact to the economy overall, yet have a huge impact on the living standards of minimum or near-minimum wage employees. So all in all, I'd say it's worth it. As someone who has been a manager at a company that hires a lot of minimum wage employees, I can tell you that if minimum wage just goes up a little bit, we simply shuffle around money here and there and we make it work. When it went from $4.25 to $5.15 about a decade ago, it was all right.

However, I find that for the last few years, a lot of people have been calling for a "living wage" that varies from $10 to $15/hr. That's just ridiculous. That's not a living wage, that's a middle class wage, unless you live in a really expensive area like New York or California.

Here's what I think a "living wage" is, and what minimum wage should be: It should be what one person requires to pay the rent, feed him or herself, pay the electric bill, clothe him or herself, and get to work. News flash: phone, cable, car, and internet are not needs. Until 1999, I had never made more than $8.50/hr(and was below $6/hr from 1992 to 1995) and got by just fine, although I won't try to say it was easy. Currently, $5.15 doesn't cut it, so we are overdue for a minimum wage increase. But we don't need $10 or $12. $6.50 to $7 is sufficient. Then index it to inflation so that we don't have to keep having this debate every few years.

However, Matt Miller does have a useful idea that deserves to be considered. He proposes rather than placing the burden on employers to pay a living wage, which would cost jobs, the government should supplement low wage workers' incomes on a sliding scale. Here's Miller's proposal:

If you make $6, you'd get a $3 subsidy, which would make your wage $9/hr.

If you make $7, you'd get $2.29, giving you $9.29.

$8, you get $1.65, for $9.65.

And it goes all the way up to $14, where it is a mere 6 cents per hour and becomes $14.06.

Now the idea here is to give everyone, as Miller says, "a minimally decent life". This isn't typical liberal social engineering. It's not a handout. These are all hand-up type stuff and it lets the market work for a mere 2 cents on the nation's dollar. This is not economy busting stuff like we see in Europe with their bloated welfare states that reward sloth and punish success. You have to work to get this money. And it's much more efficient than the Earned Income Credit which it would replace.

Thursday, January 06, 2005

The nature of the enemy

This image is from a Hezbollah rally.

Monday, January 03, 2005

Energy independence

Here's an idea to help wean ourselves off Middle East oil.

Why don't people buy Hybrid cars?

Part of the reason is price and the fact that the auto companies haven't been pushing them hard. In order to encourage hybrid car use, the federal government offers a $1500 tax credit for purchase. Now that's a good idea and all, but what does it really accomplish? Seems to me like the government is just wasting money by throwing nickels and dimes at it. Why not, if we are serious about energy independence, offer a $10,000 tax credit? That would make hybrid cars cheaper to buy than the traditional solely gas-powered vehicles. Also, allow the auto makers to deduct advertising costs for hybrids from their corporate taxes, so consumers can hear about these fine cars.

Here's another idea. Let's expand our use of nuclear power. Europe has figured this out. Nuclear power in the West has a phenomenal safety record, so it's time for Greens to quit whining. It's also environmentally cleaner than coal or gas powered plants, provided you can dispose of the waste, which we can. But for right now, in light of the war on terror and the importance of self-suffiency, we should get off oil as much as possible. Thomas Friedman, NY Times columnist, has been going on and on about a "Manhattan Project" in energy. We don't need one. We already have alternative sources that we aren't using because oil is just more cost-effective and our infrastructure is currently built around using lots of oil.

I see no reason why we can't bring our oil usage down to the point where domestic supplies more than cover it. We should be a net oil exporter, not a net oil importer. It would also do wonders for our trade balance and current account deficit. I think a President should lead on this and make it a goal to totally wean off foreign, or at least Middle Eastern, oil, within 20 years. It can be done, and it starts with hybrid cars.

Social Security

Matt Yglesias has a post, one of many recently, on Social Security. He is making the case that there is no crisis. I have a serious problem with this. Yglesias is one of my favorite bloggers and is on my must-read list every day. He's a serious liberal thinker who seriously evaluates policy without the hackery we see so much of these days. Although he opposes Bush, if Bush comes up with a good policy, Matt will honestly evaluate it as such.

But on Social Security Matt seems to be letting his more base instincts take over. In previous posts, he simply said that there was no crisis, Social Security is just peachy until 2041. Finally, he addresses the fact that after 2018, Social Security is expected to pay out more than it takes in. How is that shortfall to be made up? By cashing in treasury bonds. And how would treasury bonds be cashed? By the general fund, which funds everything besides Social Security and Medicare. So one of two things happens. Either a) other government programs have to be sharply cut, or b) taxes have to be raised. Now I guess it's not a crisis in that Social Security isn't going to disappear into a black hole. But it is a crisis in the sense that Americans will have to make extremely painful choices between popular government programs, or the middle class is going to get severely burdened with high taxes.

Matt blithely says this:

Today, the agents of America's rich in the Republican Party are proposing that the wealthy default on their debt to the middle class. That this proposal exists is the only thing that Social Security must "reckon" with for the next several decades.

The people facing the day of reckoning are the high-income folks who will soon need to start paying their bills. Rather than pony up the cash, they prefer to default. The voters -- and the congress -- shouldn't let them.

I wasn't aware that the rich were obligated to pay. What statute says this? Okay, seroiusly, I know there is none and so does Matt. Matt just believes that the wealthy should make up the gap between outlays and revenues that currently exists. And this is where I strongly disagree with liberals. Why is the solution to a struggling government program always to tax the rich? And who is rich? Revoking the Bush tax cuts on just those making more than $200,000/year, as Kerry wanted, won't help all that much, especially in light of other proposals he had and liberals like Yglesias still have on their wish list.

No, as with all large scale programs, you simply cannot fund them without tapping the largest revenue base: the middle class. To suggest an increase in the middle class tax burden beyond where it's at now is simply a non-starter in my opinion, and I think most people from the center to the right agree. The middle class is already overtaxed.

How about the rich? Are they undertaxed? Possibly, you could make that case if you compare all taxes at every level, as all but income taxes are regressive. But if so, they are undertaxed in relative terms, not in absolute terms. In my opinion, and this is also supported by most opinion polls, no one should pay more than 20% of their income in taxes at all levels. Scroll down about halfway, and you'll see a poll here that shows that 90% of Americans agree that 30% is the upper limit. 60-65% agree that 20% should be the maximum tax rate. I don't see the solution to tax fairness as increasing the burden on the rich. If I'm being treated unfairly I don't respond by demanding that someone else be treated unfairly as well. I demand fairness for all of us. The solution to tax unfairness is not to raise taxes on the wealthy, but to reduce them for the middle class. Let the wealthy pay 20%, the middle class around 10%, and the poor nothing. That's tax fairness.

Back to Social Security, I fully support private accounts. The only way to make the system sustainable is to take it from pay as you go, to a system where each worker funds their own retirement. The pay as you go system is based on an untenable assumption: that there will be enough workers to support the retirees. But if you have a system of private accounts, it doesn't matter.

I'll debunk the main objections in later posts. I have yet to hear any legitimate arguments against private accounts as a concept. The only objections I've heard that have any merit are who is handling it: George Bush. He also wants to borrow the money to pay for transition costs, which is also a very bad idea. We can certainly all argue about the merits of Bush's plan once it's proposed, but for now let's concentrate on the concept of private accounts in general. I see no legitimate argument against them.

Sunday, January 02, 2005

The 2% solution-part 3

The next two chapters in Miller's book deal with education. The first proposal is to create "millionaire teachers". His second is for vouchers that liberals can support.

Millionaire teachers. This is fairly straightforward, but it has ramifications that Miller goes into detail about. The idea is to pay teachers enough that providing they show a decent grasp of financial responsibility, they will grow to become millionaires. He would peg starting pay at something like $60,000 and top pay at around $125,000. Conservatives might object, "What?! How does giving more money to teachers who already aren't doing a good job help matters!" That's where merit pay comes in and where liberals and the teachers unions will have a conniption. Miller proposes very substantial pay differentials for good teachers vs. average teachers. He also would make it easier to fire teachers who are not up to par. Another effect of his Millionaire Teachers program would be to attract top graduates to the profession. Because of hard work for low pay, the lowest a person with a college degree can expect, the people that tend to become teachers do it for two reasons: they love teaching(the good ones) or they can't hack it in the private sector(the bad ones).

So in speaking with conservative thinkers, Miller manages to get tentative support for his idea. But he finds more resistance among the teachers unions. The unions want higher pay, that's great. But merit pay, substantial merit pay, for better teachers? Firing bad teachers? The first objection is, who decides? Well, in going around schools, Miller found that there was almost always near unanimous agreement among students, teachers and administrators as to who the best teachers were. I've found this to be true when I was in school as well. I attended several in my time. Everyone knew who the good teachers were and the ineffectual teachers and there was seldom any sort of debate. The only time there was serious dispute was in cases where there was a teacher who was really popular with students but didn't really do much in the way of teaching. So let's dispense with the "who decides?" argument. There will be a level of subjectivity, but in most circumstances there will be little argument with the decisions on who gets the big raises and who gets canned.

The second objection the unions had was over job security. Teachers seem by nature to prefer security over the chance at higher pay. Well, Miller replies, how about if we offer two tracks? Those who want to keep job security can continue to make the current ridiculously low salaries, and those who want a shot at big money can choose that track?

Then we get to where conservatives will jump back off the wagon. The only way to fund this is for the federal government to do it. But surprisingly, Miller found that conservatives' objections were lukewarm at worst. I've also noticed that in recent years conservatives have become less dogmatic about the federal government involving itself in traditionally state affairs. Might have something to do with the fact they have the power right now. All in all, I think this plan is probably the single easiest one to sell in Miller's entire book. Who doesnt' support rewarding good teachers, attracting better teaching candidates, and getting rid of teachers that are failing to educate the students entrusted to them? Only the unions. And they have no power in this matter if the teachers are drawn by the higher pay being offered as an inducement. Mark my words. If this proposal is seriously brought up and debated, it will pass quickly.

Vouchers. What do liberals define as the single biggest problem with America's education system? The fact that schools are funded primarily by property taxes. What's the solution? Well, the old liberal solution was to pour federal money into inner city and poor rural schools. Problem is, even where they've done so it simply hasn't worked. Plus, from my own studies of the issue I've determined that there is little relation between per student education spending and academic success. The Midwest spends the least yet has the highest achievement as measured by graduation rates and test scores. The Northeast and California have the highest yet tend to be middle of the pack. The South is the worst, and spends at levels in between the North and Midwest. Miller really doesn't spell this out, but he does seem skeptical that simply pouring more money into these inner city schools will accomplish anything. Instead, he proposes using the magic of the marketplace, the magic of competition, to bring about improvement in quality(combined with millionaire teachers, of course).

How about a "grand bargain", as Miller aptly coins it? Why not increase per pupil spending by about 20 to 30 percent, and give every student a voucher which they can use to attend any school they wish? Why should inner city kids be stuck with inner city schools? Currently we have a situation where some schools are so horrendous, and a good school is located only a couple of miles from the bad school. So parents that care enough feel forced to lie about their addresses so they can send their child to the good school. Miller predicts that if every student had a voucher, that more private schools would be built to meet increasing demand. This would in turn force public schools to compete. This proposal seems to rely on a lot of assumptions and tweaks a lot of people the wrong way. In contrast to his other proposal for education, which is the easiest to pass, I think this one will be the hardest by far.

One point which Miller doesn't mention, and probably the most important, is the students and parents themselves. I think the reason he doesn't go into it is because quite simply it's outside the scope of his book. The government can't make students want to learn or parents give a damn about their children's education. A local news story in my area reported that in a failing school where the students were eligible for vouchers, only 10% took them. Parents interviewed said that they didn't want to have to drive their kids farther to a different school. WTF!? This is the kind of attitude that is 90% of the education problem, IMO. Parents that don't give a damn, students who treat education as something uncool.

However, he could have mentioned this if he had a solution. Fortunately, I do.

Bribe the students. Yeah, I know, some people are going to think there's something dirty about paying students to do well in school. But you know what? In the real world you will be paid in accordance with your achievement. You'd be shocked at how cool learning would be if students got $50 for every A on their report card, and $25 for every B, with a single F meaning no bonus at all. And you can be darn sure that inner city parents that struggle to pay the bills will be wanting their kids to bring home the money for the electric bill once every two months. In real life, the vast majority of most people's efforts are dedicated to making a living. Might as well instill this work ethic in students from the start. It's perverse that we expect kids to work hard just because they it's the right thing to do, but adults demand immediate gratification(a paycheck) for work they do. School is analogous to a real job. It's preparation for a real job. Why not just make it a real job?

A new Iraqi blog

Democracy in Iraq is mainly dedicated to election coverage. Always great to hear from Iraqis.

Freedom House releases its 2005 report

You can look at the basic table here.

Overall, I'd say it's encouraging, like most Freedom House reports since the 90s. Afghanistan continues to make progress. Ukraine of course, also has improved. About a dozen other nations improved their ratings, mostly in Eastern Europe and the Asian Tigers. Egypt and Jordan also improved, which could be interpreted to show that Bush's desire to achieve democracy in the Arab world is making slow but steady progress.

Now the bad news: Most glaringly, Iraq has shown no improvement since 2003. Iraq became freer by two points with Saddam's fall, but showed no further progress during 2004. Let's hope the elections do for Iraq what they did for Afghanistan. Africa took a few steps back again. Haiti got worse.

The most galling part of the survey is the 7,7 nations, the most oppressive of the oppressive. Some are obvious enemies of ours, and with a human rights record like that, with good reason. But Saudi Arabia, a longtime ally, has also consistently been at 7,7. I realize that we are dependent on them, but I hate the idea of selling my soul for oil. That's why I don't. I don't drive. My total oil usage, if everyone lived the way I do, would be covered entirely by domestic production. I really wish everyone would make an effort to reduce their oil usage. It may be comforting to blame the government for coddling Arab dictators like the Saudis, but they are only looking out for our interests and desires. And we the people want cheap oil and raise holy hell if gas gets above $2 a gallon.

Saturday, January 01, 2005

The 2% solution-part two

The first major proposal Miller makes is in health care. Basically, he calls for a system of subsidized insurance not connected to employment. This is similar, although he doesn't mention it, to the Swiss system, which basically only provides help to those who need it. Personally, I've never understood the Canadian and British systems of pretty much just nationalizing health care in the interests of helping the poor, yet affecting the majority who didn't need help in the first place. Perhaps at the time it seemed like the simplest solution, to just create a single-payer system, but in hindsight, and in comparison with other universal health care systems, single payer seems pretty clunky.

The main legitimate objection that one would make to such a plan is that it would simply cause insurers to just keep on jacking up their rates, as well as cherry-pick the very people who don't need insurance. Miller addresses this by calling for community rating, as in everyone pays the same for insurance of the same type regardless of health history, age, sex, etc. The price differentials in insurance would be because of bells and whistles, not essential coverage. For example, a rich man might choose the best insurance, which would give him a private room in a hospital and no waits for non-emergency procedures, while the poor slob making minimum wage would get a gurney in the hospital hallway and Canadian-style waits in weeks for non-emergency procedures. I think people obsessed with equality of outcome might be offended by all this, but why? Everyone gets the care they need under this plan.

The genius of this plan is that it doesn't cost all that much. First, it would get health costs off of employer's backs. Second, it would mean we could end Medicaid and Medicare, and replace it with the new subsidy program. There is already something like $1.3 trillion out there between business and government costs that can be reallocated towards subsidies. The extra cost comes from insuring those not currently covered by any source. Miller estimates this would cost about $80 billion a year in today's dollars.

I say it's a great plan, except Miller doesn't really address why we have a health care "crisis" in the first place: ever-increasing medical costs. The main reason for higher health care costs is new procedures and drugs. This is actually a good problem to have, which is why I put the scare quotes around the word "crisis". One thing I think would work is to start out with 2004 insurance, as in the customer gets every procedure available in 2004 for a certain cost. His insurance costs will not go up. However, every year he wanted to upgrade his insurance to cover brand new procedures he could, or if he's about ten years behind, upgrade, say five years.