The Affordable Care Act creates a new health insurance marketplace (the exchange). But because of the great uncertainty about what buyers will enter the market and who will buy what product, the law creates three vehicles to reduce insurance company risk.
Politicians and bureaucrats are notorious for manufacturing euphemisms -- clever but deceptive substitutes for what they really mean but don’t want to admit. That’s how the phrase “revenue enhancement” entered the vocabulary. Some of our courageous friends in government couldn’t bring themselves to say “tax hike.”
It’s easy to be negative about the U.S. economy these days. Find a glint of silver, and folks come running to point out all of the dark clouds looming about. This, of course, is what we got last week when the monthly jobs report was released from the U.S. Department of Labor (DOL). Folks pooh-poohed the number of jobs and whining that they’re not enough or that it’s less than a bunch of economists thought that it might be. But you know what? Stuff ’em.
Facts are easy. You can check facts. What supporters of the Affordable Care Act are doing, on the other hand, transcends factual bungling. It’s far more advanced: a warping of reality so debauched it looks like something out of a tale by H.P. Lovecraft.
The east coast and parts of the southern U.S. were to varying degrees paralyzed by blizzards a few weeks ago. The snow as expected rendered the roads treacherous, and in anticipation of slick streets, shoppers flocked to the grocery stores in advance.The rush into grocery stores, and its aftermath, offers worthwhile lessons in economics.First up, […]
The highest form of charity, argued the 12th-century Jewish philosopher Maimonides, is when the help given enables the receiver to become self-sufficient.But our systems of state charity — aka welfare — have too frequently had the opposite effect: They have actually created dependency. It is time to rethink the way we help people.I’m going to […]
Last year was quite the year for Bitcoin. We’ve seen exponential growth in Bitcoin’s exchange rate and extensive coverage in the media. Another phenomenon we have witnessed is the proliferation of alternative cryptocurrencies, five of which we’ve provided below.What all of these cryptocurrencies have in common is that they rely on a decentralized network to […]
President Obama crowed in his State of the Union speech about the economy, even mentioning “a rebounding housing market.” Maybe he was referring to friends in high places, like the seller of Penthouse One in New York, which just closed for $50.9 million, all cash. Millions of mere-mortal homeowners likely wanted to throw something at […]
The nonpartisan Congressional Budget Office is acting in a bipartisan way to cover up the biggest single threat to the bipartisan political alliance that is stripping America of its wealth: the United States Congress.There is no question that the following policy is bipartisan. Democrats and Republicans in Congress are completely agreed that the following information […]
Recent difficulties with implementing the Affordable Care Act have increased opposition to the program. A majority of Americans now oppose it. Problems with the HealthCare.gov website are in all likelihood temporary. However, there are serious long-term problems, particularly considering long-term finance and labor supply issues. Given the mounting difficulties with and growing concerns about the […]
The faces of the Detroit bankruptcy are the thousands of pensioners whose promised benefits are suddenly part of the restructure negotiation. When Motown filed for Chapter 9 last July, the city had $11.5 billion in unsecured liabilities. The vast majority of this was pension and health care benefits owed to retired city employees.The images of […]
“Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”As the inequality gap grows, there is an ideological battle unfolding in the West.On the one hand, there are those who think government can fix things. It must do more, tax more, […]
On Feb. 7 the United States will once again reach its statutory debt limit, meaning it cannot legally borrow any more money. Since the obvious option of cutting spending to match the amount of revenue that the government collects is off the table for some inexplicable reason, Congress will have to pass a new, higher […]
The New York Times published an interminable article on health care recently. Plenty of facts — how scrupulous are these journalists! — but the article displayed absolutely no comprehension of the basics of cause and effect. I was left wondering about the whole point.The article details how the health care system rewards specialists to an […]
The Largest Company in History:“The United States Corporation of Government (USCOG)”I follow global social and commercial networks, looking for entrepreneurial opportunities.Innovation surges when industry and government models change. Buggy whips. Landline phones. Railroads. The Soviet Union. Apartheid South Africa. All marked social and commercial innovation, both bad and good.We are witnessing a new form of […]
We’d like to give the banks in Australia some credit. They’ve finally gone and done it. They have caught up with 1960s technology. They’ve figured out how to use PIN numbers.How to only use PIN numbers, that is. They’re considering scrapping signatures on credit cards to cut down on fraud. Apparently, having to verify your […]
We put in a good-citizen call to the SEC the other day.“There’s a massive scheme to manipulate stock prices,” we told the friendly agent.“I have to tell you that your call is being monitored so that we can better serve the public,” he replied.“Oh, don’t worry about that. The NSA is tapping our call anyway.”“Are […]
Dr. William C. Padgett is a retired optometrist who has been trying to bring an elderly care facility to Beaufort County, North Carolina, for over a decade.“Our senior citizens,” he laments, “are finding that it is difficult and in many cases impossible to find an appropriate long-term care facility locally.” Though he has received several […]
If you don’t have the angst out of your system concerning Wall Street banksters, Government Sachs, and the Affordable Care Act, settle in with Matt Taibbi’s Griftopia to make your blood boil one more time.Investors should be reminded of 2008 as they shrug their shoulders and put their money back in the stock market. The […]
What do 8 of the 10 wealthiest people in the U.S. have in common?Aside from being able to fly in private jets, the common thread is that each of them has made their fortune thanks to a start-up.Let me explain…From tech titans like Bill Gates and Larry Ellison (founders of Microsoft and Oracle, respectively), to […]
“Inequality is the defining challenge of our time,” according to President Obama. It’s certainly the topic of the day for Paul Krugman, Joe Stiglitz and a whole raft of liberal pundits.But have you noticed that hardly anyone else is talking about it? When is the last time you heard a shoeshine person or a taxi […]
In December of last year, I left my career to travel the world for one year.My plan was to visit as many countries as possible on my Star Alliance Around-the-World ticket in the first nine months, then, for the remaining three months, return back to the country that most caught my eye and my curiosity.Nine […]
Economic history is primed to repeat in the nastiest of ways unless the government stops distorting the price of something we use every day.Every product, good, or service has a price, which is essential to rational decision-making. We use prices every day as vital data that guide us. Without true prices, prices not distorted by […]
A new survey from Harvard University found a large majority of young Americans do not believe the law will save them money, do not believe it will improve their health, and do not intend to sign up for insurance through the new exchanges.
Uh-oh!The new pope, Francis from the Pampas, has just warned us to beware the “tyranny” of capitalism.Each man worships his own gods. Some worship at the altar of Jesus of Nazareth. Some at the altar of the Almighty Dollar. The capitalists don’t bad-mouth Francis’ god. You’d think he would cut them the same slack.Bad-mouthing Catholicism […]
The market has selected different things as money throughout history. Some of these items have served as money in isolated places for specific periods of time — for instance, cigarettes in prisoner-of-war camps. Cigarettes continue to be a currency in prisons if allowed, but if not, according to Wikipedia, “postage stamps have become a more […]
A president stands disgraced. Congress is scattering. Bureaucrats are baffled. Pundits are reaching. Industry is scared. Politicians are scrambling to do something, anything, to make it better. One political party is in meltdown and the other loving every minute of it, hoping to ride the calamity to electoral gains.The so-called Patient Protection and Affordable Care […]
I was standing outside the hotel when a gigantic bus rolled up. It was a double-decker and seemed as long as a city block. One hundred-plus people poured out. Once empty, the bus drove on. I stood there right in the path of the exhaust fumes. It was a cloud of gray, bellowing like a smokestack, filling the front entrance of the hotel with a thick haze of exhaust that lingered for what seemed like minutes.
As it happened, I had just left my hotel room, where I was researching the Obama administration’s proposed mandates on fuel economy. The standards covering Corporate Average Fuel Economy (CAFE) will be tightened on cars so much (52 mpg by 2015) that some observers can’t even begin to think their way around them. Gas-powered cars will have to become so small that we’ll all be driving around like the Italian bourgeoisie, or they will be have to be hybrids or all-electric.
Oh, and for the first time, broadly relevant standards will apply to trucks and buses, which have by and large escaped the squeeze so far. Think about this. Cars have undergone a gigantic transformation over the past 30 years because of these standards. Sure, consumers like to save gas, but at the expense of safety, elegance, and vehicle longevity? A free society would leave the right mix of these to industry and consumers. In a mixed economy like ours, the central planners think they know better.
But why have trucks and buses escaped? The loophole is so large that it is mostly responsible for the invention of this thing called the SUV. Time was when such things were only a tiny percentage of the marketplace. Now more than half the passenger vehicles sold are in this category. Depending on how you calculate it, the category of buses and trucks including SUVs is responsible for more than two-thirds of the pollutants in the air. Yet they keep targeting cars.
I became curious about this a few weeks ago when a neighbor held a party at his house. The whole block filled up with the most gigantic cars ever. I couldn’t believe my eyes. Just as the government is trying to reduce vehicle emissions, these monster cars, called trucks, are selling as never before.
I’ve not seen detailed studies on this, but just glancing at the existing reality suggests that we have yet another case of “unintended consequences” of government regulation. Instead of putting the masses of people in tiny, tin-can cars, the regs have prodded those who can afford to take the step to upgrade to these giant things they don’t need or might not even want.
But this still begs the question: Why have trucks and buses gotten away with this so far? Well, there are the lobbyists, of course, and trucking interests are powerful. But there’s another factor that seems ideological to me: The government doesn’t like individual drivers.
To the miserable bureaucrat, cars seem like too much the sign of capitalistic decadence. The car empowered us as individuals. The collectivist-oriented bureaucracies don’t like that. They want us shuffled around in big mobs from place to place, or wheeling around on bicycles as in Mao’s China. If we are to drive our own cars at all, we are supposed to “carpool” and fight over the radio dial. This is the bureaucratic/political mind at work.
Let’s think about this in bigger, longer terms. The nature of travel is one of the most changed by the advent of the capitalist economy. For most of the human history, travel was something to dread and even avoid at all cost.
Just look at the term itself. The word travel shares the same Middle English root as the word travail, which means to toil or labor. The word in Middle English was travailen, which meant something deeply unpleasant. Looking even further back in time, we find the Latin slang word travailler, which means… to torture!
Indeed, through human history, traveling has usually been torture. If you see a movie set in the Middle Ages in which one person is traveling on his own and is not being forced to do so, you can pretty much assume it is untrue. No one traveled alone. If you did, you would certainly be robbed, beaten, enslaved, or killed. You always traveled in groups, and these groups had to include people who could protect you. There was no other way. Most people stayed put.
What about modern times? Everything has changed. As usual, we take it for granted.
Michael Graham Richard did some interesting research on travel times in the United States, based on the 1932 Atlas of Historical Geography of the United States. What he found is quite revealing. It took people an entire day just to get out of New York. Going from New York to Georgia or Ohio took two weeks. If you wanted to get to Louisiana or Illinois, you had to set aside a full five weeks! That’s just to get from here to there.
But thanks to railways, all this changed half a century later. What used to take two weeks in 1800 took only a day or two by 1857. If you set aside a week, you could get to Texas — the travel time sliced to about 20% of what it was 50 years earlier. In a month, you could get to California, which was rather amazing by historical standards. Also, you wouldn’t typically be beaten, robbed, or killed, which was pretty great.
By 1932, modernity had arrived. You could go coast to coast in four days!
Of course, now you can do all of this in a few hours, thanks to planes and cars. And driving itself became more fun than ever. It’s one of the great changes in the history of the world: Travel went from torture to joy. And it happened because of technological advances working through a market system that serves people in their daily needs. Getting from here to there is one of the strongest needs that we humans have. It is what gets us all the things we rely on for the good life.
We live in times when government regulations are working to turn back the clock. They are after conveniences such as toilets, showers, washing machines, microwaves, and anything else that makes our lives just a bit happier at the margin. That includes cars.
I have some respect for the hope that our cars will emit fewer pollutants. Everyone wants cleaner air and no one really wants to contribute to environmental problems. But I do not for an instant believe that this is the real reason behind these regulations. What the bureaucrats want is to make us just a bit more miserable, dependent, and poorer, plus slightly less mobile. These people know not the meaning of human service, so they turn their powers to the opposite cause: taking away from us the things we dearly love.
They could never convince us to give up our cars by pure persuasion, so they resort to regulatory coercion to make it happen. They want us all to gather in double-decker buses and travel in packs of 100, just like those people I saw pouring out of the bus that day, all coming from the same place and all landing at the same place. This is the bureaucrat’s dream. But it is not ours.
Our dream is for flying cars. We might get there someday, but it won’t be because government pushed the idea.
A final practical note: Remember the “cash for clunkers” program that paid people to buy new cars and destroy their old ones? That ridiculous program sent the prices of used cars soaring. Well, they are falling back to normal now. Used cars on average have gone up at half the rate of the overall CPI, if you look at numbers back to 1995. It’s a good time to buy — now, before the Obama administration has its way.