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Archive for the ‘Economics’ Category

Random Connections

Posted by Dan Draney on March 22, 2012

We can’t look at the news without seeing examples of What’s Wrong with the World Today. Face Palm Example 1, entitled “FDA Accepts Public Comments on Emergency Shortages Data Collection System” reads in part:

Many medical devices are essential products to the patients who use them. If the supply of these devices were interrupted—in the case of a natural disaster such as a hurricane or earth quake, for example—lives would be at stake. To prevent such scenarios from becoming reality, FDA created the Emergency Medical Device Shortages Program Survey. Developed after the September 11, 2001, terrorist attacks, the survey is intended to allow FDA to collect data on domestic inventory, manufacturing capabilities, distribution plans, and raw material constraints for medical devices that would be in high demand or vulnerable to shortages if a disaster or emergency would strike or certain regulatory actions were taken.

via FDA Accepts Public Comments on Emergency Shortages Data Collection System | MDDI Medical Device and Diagnostic Industry News Products and Suppliers.

Because in a crisis, obviously we could all rest easier knowing that a massive, slow-moving, inflexible federal bureaucracy is ready to take total control of all aspects of the supply chain for everything important.

The only better way to assure that shortages will occur would be to establish price controls to prevent “gouging.” Gouging occurs when anyone pays what something in short supply is actually worth. Don’t worry, though, price controls will be the natural, first response of the FDA.

Closing question: What do you suppose they mean by “if … certain regulatory actions were taken” in that quote?

Meanwhile, over at The Nation, Jeff Madrick provides Example 2, as he wonders, “Can Americans Trust Government Again?

Contrary to what we hear from Republicans, America did not lose its way in the past few years. It lost its way a generation ago when it abandoned its faith in government.

Conventional wisdom has it that come November the 2012 presidential election will be determined by the state of the economy. Actually, the real battle will be over a much older fundamental ideological issue in American politics: what role government should play in shaping our future. This special issue of The Nation is dedicated to bringing the debate about government front and center as the presidential race heats up.

Because in his view, it’s not that the government consistently fails the basic tests of competency in practically everything it attempts. It’s not that appetite for new government programs, regulations, and rules is boundless. The problem is that people growing disgusted with the overreach and looking at the results have lost faith. If we just give the government more control over every private decision, we’ll reach Utopia. You Gotta Believe!

Nonetheless we wish them well in bringing this issue to the forefront of the presidential race. I sincerely hope these two competing visions are a major part of the debate, because they are the root of our political disagreements.

Posted in Economics, regulation | Tagged: | Leave a Comment »

Peculiar Result in Neb Primary

Posted by Dan Draney on May 24, 2010

can of hammerheads

Which is smarter: A Dem primary voter or this can of hammerheads?

Last Tuesday’s primary election here in Lincoln for the Congressional seat currently held by Jeff Fortenberry [R] is a bizarre and largely untold story. No, Rep. Fortenberry did not drown in a TEA Party tidal wave; he easily beat back his primary challengers. The oddity was in the Democrat primary, with the party’s choice, Ivy Harper, facing off against a group of amateurs. Two of her opponents were so inept they had no web presence at all and didn’t even bother  answering the questions to get into the Lincoln Journal Star Voter’s Guide.

Harper campaigned as a “moderate” Democrat, to the extent one believes such creatures exist, calling herself the “Center-Pivot Candidate.” It’s a small joke on the center-pivot irrigation systems, widely used in Nebraska, which apparently means she’ll be going around in circles. Or perhaps, it’s that once she’s elected she’ll pivot sharply to the left? On the issues Harper advocates pretty conventional liberal positions.

So it was shocking to see Harper struggle to eek out a win in a very tight race against Jessica Lynn Turek. Turek’s qualifications and positions via the Journal Star Voter’s Guide:

Turek says she is a Nebraska native who works to make us prouder Nebraskans. She says people deserve economic stability. Technology has made our lives easier and now is the time to make positive adjustments.

Turek has a Bachelor of Arts degree, more than six years of professional library experience and a year of AmeriCorps work.

What would you like to accomplish as a member of the House during the next two years?

Raise the minimum wage; price caps on housing, autos, produce and gas. Price caps on energy and make money beautiful and smell good.

Do you believe Congress should attempt to govern in a more bipartisan way, and if so, what actions would you take to try to help achieve that?

Bipartisanship is a natural result of good ideas. Positive, the Nebraska we want. Everlasting for the future now.

The rest of the questions were unanswered. Now Ms. Turek may be a wonderful person, but who in the world reads this kind of thing and decides, “Yeah, I’ll vote for that?”

Posted in crazy leftists, Economics, Fortenberry, Nebraska | 5 Comments »

Greeks In the Streets

Posted by Ryne McClaren on May 2, 2010

America, welcome to a snapshot of your future!  Greeks take to streets in protest of deep spending cuts.

Tens of thousands of demonstrators took to the streets across Greece on Saturday, including hundreds of black-clad youths who clashed with the police here, as Greeks vented their rage at tough new austerity measures aimed at securing aid and avoiding a debt default.

[…]

The protests, and a planned strike on Wednesday, are a sign of the challenges ahead for Greece. On Sunday, Prime Minister George Papandreou is expected to announce cost-cutting measures totaling 24 billion euros (about $32 billion) that will include freezing public-sector salaries, raising taxes and slashing pensions. In return, Greece is expected to receive up to 120 billion euros in aid over three years.

Greece is, thanks to having their arms twisted, slashing their runaway “social democratic” spending ways, all in hopes of receiving an influx of necessary euros to keep their country from collapsing.  I mean, long story short.

But surely the can-do attitude can keep the country of Greece running, right?

Wrong.  Many in Greece are responding with nothing short of rage.  Sweet, sweet rage at the government that they require and expect to sustain them from the cradle to the grave.

The government’s proposals for deep spending cuts pushed by the International Monetary Fund have met angry resistance in a country where one out of three people is employed in the civil service, which until now has guaranteed jobs for life. The shake-up of Greece’s bloated public sector represents one of the biggest overhauls of the country’s welfare state in a generation. Fears are growing that once Greek society begins to feel the effects of the austerity measures, social unrest could unhinge a potential recovery or force the government to dilute some changes.

“This crisis is not my fault, I won’t accept these austerity measures and I want to know where all the money has gone,” Emily Thomaidis, 29, the owner of a coffee shop, said as she marched through central Athens past vendors selling newspapers with the headlines “Fear. Rage. Hope.” She added, “Why should my generation have to pay the price for problems created by our parents’ generation?”

I can’t remember the last time I read such a delicious, delicious quote in a newspaper.  “Why should my generation have to pay the price for problems created by our parents’ generation?”

Oh my… the glorious irony… the lip-smacking schadenfreude.

Because this is how it works, Emily.  This is government in action.  This is the essence of government, being acted out on the global stage: Patching and solving problems by passing the buck to its future generations.

Given the tragedy and farce of such beautiful American endeavors such as the “stimulus,” and Obamacare, I hope that the New York Times archives this piece of work for future reference, because they’re going to need to run it again and again in the coming decades.  Except the scene won’t be Athens.  (Well, Athens, Georgia, perhaps.)

But there is hope yet.  Surveyed Greeks claim to support these fat-trimming measures (84% claim that the economic difficulties present the chance to introduce needed reform).

One can only hope that they’re not three to five generations (at least) too late.

Posted in capitalism, debt, Economics, socialism | 1 Comment »

It’s the Debt, Stupid

Posted by Dan Draney on March 28, 2010

It’s been said before, but rarely this well. There’s more where this came from: In the End, There Is Only the Debt – Victor Davis Hanson – The Corner on National Review Online.

In short, the United States is floating far more loans than ever before in peacetime, and for longer scheduled durations, because interest rates are only a quarter of what they have been in the past. But this theory that we can endlessly multiply the size of our debt because the service costs remain low and static is a prescription for disaster — like the credit-card introductory offer of 2 to 3 percent for 6 months that hooks the naive into charging thousands of dollars, only to end up without the means to service the debt when the rate climbs over 20 percent. For a technocracy that is Ivy League certified and brags about its competency, we have fallen into the age-old trap that snares the naive ARM house buyer, the teenaged MasterCard mega-borrower, and the “free” coupon holder who heads headlong to Vegas.

That we are borrowing now at cheap interest hundreds of billions for things that are unnecessary or counterproductive will only make it worse, psychologically, when we have to pay it all back with high interest. It reminds me of the boom-to-bust neighbor who bought his superfluous super-duper, hydra-headed, metallic red-painted hydraulic vine-cutter with easy farm loans in the late 1970s and, when headed for bankruptcy in the 1980s, looked at the now rusted, useless contraption in his barnyard and sighed to me, “And I’m still paying 17 percent on that sucker!”

Posted in debt, Economics, government spending, Porkulus, socialism | Leave a Comment »

The Federal Pay Premium

Posted by Ryne McClaren on March 8, 2010

If you’re working for the federal government, then congratulations.  The chances that you earn more than your average counterpart in the private sector is above average.  In fact, it’s nearly a certainty that you’re better paid than someone with similar (or identical skills) performing the same job on our side of the fence.

From USA Today comes this story, culled from an analysis of Bureau of Labor Statistics data: Federal pay ahead of private industry.

Federal employees earn higher average salaries than private-sector workers in more than eight out of 10 occupations, a USA TODAY analysis of federal data finds.

Accountants, nurses, chemists, surveyors, cooks, clerks and janitors are among the wide range of jobs that get paid more on average in the federal government than in the private sector.

What does this “more pay on average” add up to?  Quite a bit actually.

Federal. The federal pay premium cut across all job categories — white-collar, blue-collar, management, professional, technical and low-skill. In all, 180 jobs paid better average salaries in the federal government; 36 paid better in the private sector.

Granted, the federal pay scale is “limited,” or capped in many circumstances.  But 180 of the 216 jobs that were analyzed were more profitable on average when Uncle Sam is your employer.  So if that’s the average, I could probably stand some of that federal pay cap myself.

This isn’t to begrudge everyone on the federal payroll, or even to argue about the disparity.  There are plenty of federal workers whose pay is commensurate with their skills and training.  But in many cases those private sector workers don’t just make less, but significantly less.

If you click through to the link you’ll see a “job comparison” chart explaining the average federal pay versus the average private sector pay for a given job.  The article makes some mention that certain federal jobs, like accounting, for example, “has more complexity and requires more skill.”

A cook working for the government makes $38,400 on average. The average for the guy working in the diner kitchen makes $23,279.

How about the position of “clergy?”  They make a whopping $70,460 per year when they’re employed by Uncle Sam, which is a certifiable chasm of $31,213 more than their non-fed counterparts ($39,247).  While I can think of a multitude of reasons that our federal government does in fact need highly trained and skillful clergy, I was left scratching my head at the “complexity” and higher level of “skills” in this one.

It all makes for interesting reading on a Monday night.

Posted in capitalism, Economics | 1 Comment »

The Perfect Krugman Slapdown

Posted by Dan Draney on March 8, 2010

I really can’t imagine how this could be improved upon. James Taranto of the Wall Street Journal:

Former Enron adviser Paul Krugman takes note in his New York Times column of what he calls “the incredible gap that has opened up between the parties”:

Today, Democrats and Republicans live in different universes, both intellectually and morally.

“What Democrats believe,” he says “is what textbook economics says”:

But that’s not how Republicans see it. Here’s what Senator Jon Kyl of Arizona, the second-ranking Republican in the Senate, had to say when defending Mr. Bunning’s position (although not joining his blockade): unemployment relief “doesn’t create new jobs. In fact, if anything, continuing to pay people unemployment compensation is a disincentive for them to seek new work.”

Krugman scoffs: “To me, that’s a bizarre point of view–but then, I don’t live in Mr. Kyl’s universe.”

What does textbook economics have to say about this question? Here is a passage from a textbook called “Macroeconomics”:

Public policy designed to help workers who lose their jobs can lead to structural unemployment as an unintended side effect. . . . In other countries, particularly in Europe, benefits are more generous and last longer. The drawback to this generosity is that it reduces a worker’s incentive to quickly find a new job. Generous unemployment benefits in some European countries are widely believed to be one of the main causes of “Eurosclerosis,” the persistent high unemployment that affects a number of European countries.

So it turns out that what Krugman calls Sen. Kyl’s “bizarre point of view” is, in fact, textbook economics. The authors of that textbook are Paul Krugman and Robin Wells. Miss Wells is also known as Mrs. Paul Krugman.

It seems Krugman himself lives in two different universes–the universe of the academic economist and the universe of the bitter partisan columnist. Or maybe this is like that episode of “Star Trek” in which crewmen from the Enterprise switched places with their counterparts from a universe in which everyone was the same, only evil.

Like Spock, the evil Krugman is the one with the beard.

If I only read one thing on the internet in a day, it’s Taranto’s Best of the Web. Read the rest of this one at Mirror, Mirror – WSJ.com.

Posted in crazy leftists, Economics | 4 Comments »

 
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