Thursday, April 27, 2006

That's right, I'm staying

Well, unless I get some fabulous offer from University of Virginia or Boston University (which won't happen), or fall in love with Charlottesville, Virginia, I am not going to grad school and I'm staying in Portland. Right now, I'm thinking too of becoming active in Portland's thriving (haha) left-wing political scene. I'm probably going to start small in working my neighborhood association of Rose City Park, but then on to City Hall. I'm the material Portland needs right now. Economist, left and better than Randy Leonard.

Rove under fire

Turd Blossom is under fire again. Karl Rove testified in front of the grand jury on Wednesday this week on "a matter", according to his lawyers "voluntarily and unconditionally", but it presents a new angle on how the new Chief of Staff Joshua Bolton will conduct White House affairs. Rove's removal from his policy-making position, although he remains in a political role, suggests that Bolton is not as passive as Andy Card, in getting between Bush's brain and his body. Well, good. Rove is a schemer, and a nerfarious one at that and should be allowed no access to the body he controls (Bush). I am almost at the end of my rope with Bush at this point. With gas prices as high as after Katrina, Bush announced that to halt further increases in gas prices, he had instituted a few measures. He told the Federal Trade Commission (FTC) to investigate price gouging and suspended environmental regulations of the additives to gasoline. While in the NY Times' words Bush noted that "high gasoline prices are like a hidden tax on consumers and businesses", his remaining energy was spend extricating the oil companies from any further burden relating to the effect of gasoline prices on the economy, which he claimed was strong (have you been unemployed recently? I have). The main solution Bush proposed was "[e]asing the environment rules will allow refiners greater flexibility in providing oil supplies since they will not have to use certain additives such as ethanol to meet clean air standards."

What!?! That's bullshit! We should be raising the emissions standards on cars and industry to combat the furtherance of global warming towards the "tipping point" at which we will not be able to reverse it. Reducing emissions will also hurt those living in cities with high air pollution like Salt Lake City, Utah, Los Angeles, California and Houston, Texas. They already have many (over 30 at least) days a year where the air is so polluted that they urge citizens not to do exercise outdoors. What the fuck? That's not how this country should be run.

Tuesday, April 25, 2006

Marxist tourists


Well, I've been really busy with work and music and trying to enjoy myself as much as possible, so blogging has really taken the backseat.

However, it would have been impossible to ignore an article in the NY Times about Chinese tourists travelling in huge numbers to the house where Karl Marx was born. I guess as the only economically growing Marxist country (even if Marxism has all but been abandoned except in the fiction of the "dictatorship of the proletariat". The sign above says it all about how many Chinese make the hajj to Marx's house.

Monday, April 17, 2006

A political nutjob I can support (being in the race, not winning)

The Washington Post reports that former Alaskan Senator Mike Gravel has announced his candidacy for president (a little early, I think) on the platform of eliminating the income tax and representative democracy (in favor of direct democracy). While his platform is way out there (much too much for me), I think it would be good to see him as a candidate (which he could if there were voter owned elections). [This blog post was unfinished (interrupted), but I'd like to use it to reiterate my policy on third parties].

Third party politics would be good for the electoral system. I think that there should be many more than three parties in the system. However, Nader-loyalists who think that a presidential bid is the ticket to multi-party democracy are dead wrong. The only way there will be more than two parties where the third party is not a spoiler party (as Perot was in 1992 for George H.W. Bush or Nader was for Al Gore) is if the electoral college is abolished. However, the only way for that to become at all an issue is not from running no-shot candidates on the Green, Reform, Independent or Constitution parties. That reinforces the two-party system (in the interests of full disclosure, I am an anti-Nader guy; he cost Gore the election and ran in 2004 to masturbate his ego). To eliminate the two-party monopoly on power, the electoral college needs to be abolished and the only way to do that is to focus on the branches that matter in deciding the matter. For the constitution to be amended to eliminate the electoral college, the Congress needs to pass a bill by a 2/3rds majority and then it needs to be ratified by some number of states (I'm no constitutional expert). Therefore, non-major parties need to focus on state legislatures and the U.S. Congress. That is the avenue for their sucess. They could learn from Portland, Oregon in enacting voter-owned elections, which provide funding for candidates that otherwise wouldn't have a chance. It would also highlight the differences between candidates who buy into the corporate money government versus those who emphasize the power of the people, the ones who they supposedly represent. Until then, third-party candidates in presidential elections are just a distraction and spoiler driven by ego gains and no real concern about the direction of the country. They can play their game as long as they withdraw before they appear on the ballot (as a way to draw attention to the failure of two-party politics), but I am sick and tired of egoists like Nader putting Bush into office (I understand that Gore's campaign was weak, but you have to look at end results to draw conclusions)

Friday, April 14, 2006

Nationalizing Health Insurance: A Strategy

In America today, 45 million people, including the author, are living without health insurance. With assistance for the poor and elderly, an outcome such as this describes flaws in the so-called free-market economy in which we live. While a more lassiaz faire attitude towards the provision of health care can be taken (but not assumed), the insurance gap (we are back in the eighties again talking about this ‘gap’ and the other ‘gap’) is a predictable anomaly. Whereas the governor of Massachusetts can assume that the uninsured are either not taking advantage of government health insurance (Medicare for the elderly and Medicaid for the poor), and chalk the uninsured population to those who ‘choose’ to be uninsured. With healthcare costs already 15 percent of the economy and growing at rates in excess of inflation (inflation is around 3.5-4.0 percent, while healthcare costs increases of most companies are projected to grow between 9 and 11.5 percent), the affordability of health insurance is becoming an ever-fading dream. Whereas five or ten years ago, an individual could provide for his own healthcare if necessary, today the costs have become out-of-reach. If one’s employer (if one is lucky enough to be in a permanent position) does not provide health insurance (even with an ever-growing proportion paid by the employees), the luxury of health insurance is becoming steadily unaffordable. While I do not know the statistics on the differential between public and private health insurance administrative costs, all statistics I have seen point to a vastly lower rate of administrative costs for public insurance like the Veterans Administration (if my memory serves correctly, the administrative costs for the VA are near 0.5 percent of the total budget, while private health insurers are much higher). From my experience in economic theory and the fact that the government would be (by definition) required to cover all Americans under a universal health insurance plan, having the government provide healthcare would cost far less and free up money for national savings or corporate investment, both of which would benefit the economy as a whole.

The reason for the vast savings in health insurance costs (I am not proposing the nationalization of the healthcare industry, just the health insurance market would be due to reducing the selection process health insurance companies must deal with. For the maximum profit, they must avoid the high-cost patients or at least charge them more money. In order to do so, they must spend countless dollars in patient risk analysis . Furthermore, they must remain appealing to their potential customers through advertising. In a universal health insurance system overseen by the government, this is not an issue. The pool of insured people is so large that the cost of weeding out high-cost customers is greater than the spending upon them (not to mention the inherent requirement to cover them). While a publicly-run system would leave smaller profits, it would create a public good (increased health) that would far outweigh the costs. The only required question about government-provided healthcare is how to operate the transition period. The government would have to transition the health insurance companies out of the market. The most effective way would be for the government to buy out all of the employees and the future obligations of the companies. However, I am not sure if it wouldn’t be more cost effective (and beneficial to the strengthening of the economy and healthcare industry for the government to immediately nationalize the health insurance companies. A compromise would be to nationalize the companies (taking on their employees for the time being and paying the owners a fixed percentage of the value of the company (I would suggest paying the value of their offices plus 20 percent of their previous year’s revenues). That would be an overly fair arrangement that would eliminate private health insurance (but not touch the actual health care system).

Once the healthcare system is nationalized, healthcare would be provided by the government using existing tax revenues, a corporate tax increase, and a tax increase on the wealthy (a reversal of the Bush tax cuts of 2001, 2002 and 2003) in the form of increased top marginal tax bracket rates, increased inheritance taxes and increased dividend and capital gains taxes. Government could then reign in unnecessary price increases by the collective weight of 285 million Americans negotiating prices as a singular unit. The healthcare cost problem is solved thus. FUCK BUSH!

Monday, April 10, 2006

Italian stalemate

As of 3 a.m. Italian time, the elections are still too close to call, which portend a mini-crisis in the "sick man of Europe" (a title recently 'won' from Germany). While the end result will likely favor Romano Prodi over Silvio Berlusconi, it will be an inconclusive victory because of the election rules pushed through under Berlusconi, which incorporated proportional voting. Right now, the polls show the center-left under Prodi winning the Chamber of Deputies, the lower house, and Berlusconi's center-right coalition with a lead in the Senate (155 to 154), with the 5 seats given to Italians living abroad uncounted. If the result is a split legislature, Prodi and Berlusconi have said they would cal for a new election, but that wouldn't do much to alleviate the stalemate. What Italy needed now was a strong win by the center-left in order to create the impression of a change from Berlusconi's policies, which have done little if anything to help economic growth. The data for GDP (year-on-year growth) and the ratio of public indebtedness to GDP are listed below:

GDP (% increase)
2000: Euro 946.4 billion
2001: Euro 963.4 billion (1.8%)
2002: Euro 966.6 billion (0.3%)
2003: Euro 967.0 billion (0.0%)
2004: Euro 977.3 billion (1.1%)
2005: Euro 967.0 billion (-0.0%)

Public Debt (% of GDP)
2000: 137.0%
2001: 138.6%
2002: 145.5%
2003: 147.4%
2004: 153.5%

Note: My calculations for public debt are probably overstated. They were calculated on, for example, 2000 Q1 debt/2000 GDP (measured at the end of the fiscal year). However, Italian debt is still quite high. Estimates I've seen for 2005 are in the area of 106% of GDP.

Bush implicated in Valerie Wilson leak

The NY Times has an article today on the increasing links uncovered by Patrick Fitsgerald's investigation between the leak of Valerie Wilson's identity and the uper eschelons of the Bush White House including both Bush and Cheney. Fitzgerald's most recent filing talks of "a strong desire by many, including multiple people in the White House" to discredit Joseph Wilson, adding that "It is hard to conceive of what evidence there could be that would disprove the existence of White House efforts to 'punish Wilson.'" This supports what many of the thinking Americans have claimed from the beginning that the exposure of Valerie Wilson, Joe Wilson's wife, as a CIA operative was nothing more than retaliation for his critical NY Times Op-ed debunking the Niger uranium claims. This theory has credibility both in the timing of the leaks and a general pattern of the Bush administration's treatment of critics. It also opens a vein of discussion about whether the President can legally and unilaterally declassify information with national security implications for political reasons. In this, not only the Wilson leak's legality is called into question, but also the leak of the National Intelligence Estimate. The latter was selectively leaked to Judith Miller at the NY Times in order to bolster the case for the invasion of Iraq. Without the legal authority to unilaterally declassify government documents, Bush could face impeachment for violating the Espionage Act of 1917. I've suspected all along that Bush and, in particular, Cheney were involved in the effort to discredit Joe Wilson and Fitzgerald's recent filing provides further evidence of a widespread conspiracy.

Friday, April 07, 2006

Theoretical Theories

In the developed countries a rise in economic instability has been characteristic of an increasingly rightist government, but the backswing has come at the end of the administrations and a new personality, however corrupted in the old administration’s policies, has been elected. The post-1970 era beginning with Ronald Reagan brought increasing inequality that was only interrupted by the Clinton era, while better in that working-class incomes rose, still continued the trend of increasing inequality. However, there was no backlash towards support for government programs to soften the blow of increasing trade and globalization, which should have occurred. The domestic economy is best served by the benefit of consumers and workers. On the contrary, the prosperity and the rhetoric suggesting infinite growth that was common in the 1990s led to further right-wing gains, despite the Democratic control of the presidency. The lure of tax cuts and reduced government, the latter heavily pushed by the Democratic executive, proved too much and ushered in an era of profligacy and militarism. The boom mentality of a growing economy corrupted the normal relations between the upper and middle classes. Normally, the two classes have acted in opposition to one another via the American Dream fantasy: the upper class couldn’t care less about the ‘lesser’ classes, while the middle class remained the bastion of economic security through hard work. With this healthy conflict, the repeal of the estate taxes and capital gains/dividend taxes has been avoided. But it was not so in the early years of the 21st century. The illusion that the middle class’ investments would reap unprecedented gains fueled a belief in the “futurism” theory. I call it futurism because it rests on the belief that “in the future, I will be one of the upper class”, without regards to current circumstance or employment. In the boom years of the late nineties, the promise seemed realizable. With an increasing share of the middle and upper classes, although not the working class and the poor, owning stock and seeing it appreciate rapidly, the belief was that a new era was upon us. What had been conveniently forgotten was the elimination of many defined benefit retirement plans that were replaced with defined contribution plans, which shifted the retirement risks onto the workers and freed up monies otherwise occupied to corporate investments. With the market booming, these corporate investments soared (and the new phenomenon of interest rate and exchange rate derivatives reducing risk for corporations), corporate balance sheets, executive compensation and returns on stock market investment values soared. Regardless of economic position, everyone began to believe they could be a part of it. With a Democratic presidency and a Republican Congress, both sides claimed credit and no one looked seriously at the sustainability of the system. Eventually, the bubble burst and a Republican government (controlling the executive and legislative branches and a large contingent of like-minded members of the judiciary), the policies have not bred a rebirth. However, despite the travails of the current adminisration, the people have not moved away from the governing and towards the opposition. In fact, many have, by statistics not connected with the approval rate of the President, stuck with the party that has overseen the economic non-recovery from the bursting of the stock market bubble in 2000-2001. How such a large proportion of Americans could be misled in believing the boom mentality and how such a large part could stick with the Republican party after their incompetent handling of the post-bust economy is the focus of my thoughts. This is not strictly an American dillimna, but an international one. A related problem to the success of conservative parties in the developed world is how the “21st century socialist” candidates are coming to power (e.g., Chavez in Venezuela, Morales in Bolivia, likely Humala in Peru, Obrador in Mexico and Lula in Brazil) in countries that, while devastated by conservative economic and political policies in the 1980s, could choose political ideologies that have been tried earlier, quite unacceptably, across the world. The reason for this shift, I believe, is that there is no coherent middle way that provides domestic stability with internationalization at the same time. In this process, the multi-lateral international organizations, as well as the domestic governments are at fault. I want to find a way to remedy the domestic and international conundrums in the post-internet bust wold.

Tuesday, April 04, 2006

Thaksin steps down...maybe

The Thai prime minister Thaksin has promised to resign when the parliament meets for its new session. This is a good development for Thailand because of Thaksin's authoritarian tendencies and, like President Bush, promised to run the country as a CEO. While Thaksin had run a successful company (he recently sold it for $1.7 billion tax-free), unlike Bush, they are united in their unpopular and divisive ruling styles and authoritarian tendencies. While it is not certain that Thaksin will make good on his promise, the potential for a reversion to democracy is good and will strengthen democracy, especially since Thaksin waited until after the election to announce his resignation so it wouldn't be seen to be caused by the "street", which could have contributed to further instability in the streets of Bangkok.