Debate thoughts

Romney promises that his tax reform wont raise taxes on middle class, increase the deficit, or lower taxes on the wealthy.  A promising change in policy.

I wish Obama had addressed the idea that small businesses need less taxes to hire more workers.  I'm pretty confident that businesses hire if demand is high, but if there's no demand, they wont hire more workers no matter how profitable.  Business profits are very high right now.

I wish they wouldn't talk past each other.  I actually like that Romney has been addressing points (somewhat).  Obama is really just making and expanding his economic stump speech. 

Bringing down rates while decreasing deductions is about incentive effects, not about budget effects; that's the whole point of revenue neutral reform.  So Romney's early point about businesses not having enough money to hire workers doesn't get fixed by his proposals.  I mean, I guess he can move that cost to someone else while being revenue neutral, but who? 

Romney: cuts through attrition based on the "is it worth borrowing from China for?" principle.   Borrowing money from China doesn't seem like a huge risk to me, I mean... are they going to come collect?  I'm pretty sure they only have one aircraft carrier.  That's not going to go well.

I think it's kind of unfair to hold Obama's pre-recession deficit promises against him.  Recessions cost money to fight, and they dramatically reduce tax revenue on account of no one has money to pay taxes.  Also, there are plenty of programs like unemployment that automatically grow.

Romney definitely has the best of the early energy policy exchange, albeit through conceding his early policy position.  I don't know how John Taylor would feel about discretionary rescues for failing state poverty programs.

I like that the debate is fairly respectful thus far.  That makes me not hate myself.

I hate how Romney presents interesting useful general principles without every being willing to instantiate them.  Why is Obama spending more time detailing Romney's proposals? Because Romney's proposals either violate his expressed general principles, or are super unpopular, or both.

Romney's "private plan better than medicare" argument is silly.  You can switch from medicare any time you want, so long as you can afford it.  Ditto for private plans.  They compete against one another.  Also, medicare is cheaper than private health insurance.

Appeals to authority are *really* annoying in this format, because they are completely contentless and hard to verify.

Always, Romney is avoiding details in favor of interesting but hilariously general problems.  Total lie about Dodd-Frank.  The "too big to fail" thing is all about setting up plans to put those banks through specialized bankruptcy procedures, not backstopping them.

Dealing with the cost of healthcare: all of the cheapest healthcares are socialized. Dear Mitt Romney, why are we ignoring that fact?

Every private insurance company is an unelected board that decides what they'll cover in insurance.

Why didn't Romneycare cause companies to get rid of insurance coverage?  It is the same as Obamacare.

Government is awesome at cost control. It just sets the prices and that's what they are.  It may be bad at providing equal quality on a given price point in the absence of market failures, but that's not what they're talking about.  And, for the record, healthcare is basically the definition of market failure.

Also, on every single point about healthcare, why do we never reference every single European nation--a group that has unanimously solved the universal healthcare problem in a variety of interesting ways?

Romney's preferred health care policy is that every state implement Romney care.  So Romney's preferred policy is Obamacare, but run by states?

Liberals think that supply side reforms are necessary for education and healthcare, I think.  Have to consider that more.  Not sure how I feel.

Romney seems to start every thing with agreeing with Obama, or discarding the accurate description of his prior policy positions provided by Obama.  I mean, fair enough.  

"trickle down government" is one of Mitt's "clever" phrases.  Emphasis on "", Mitt's, and phrases.

I'd like to just have Obama say "I will return to Clinton era policies: policies that coincided with the most prosperous time in our nation in recent years.  In what way is that radical or dangerous?"

And just one more thing (still contraceptives)

The key question about whether Catholics are harmed by the contraceptive mandate is whether they are being asked to do something immoral.  I don't think they are.  The key questions about whether religious freedom is harmed by the contraceptive mandate are:
1. Is the mandate objectionable to some on the grounds of faith?
2. Is there a legitimate federal interest in overriding these objections (as in prohibitions on human sacrifice or (perhaps less legitimately) polygamy)?

It's clear that the answer to 1 is yes, but it's not clear that the answer to 2 is no.  The federal government heavily subsidizes employer provided healthcare, so one might reasonably think that if you take the subsidies you have to take the strings that come with them.  Furthermore, it seems possible that there's a legitimate federal interest in reducing healthcare costs, and perhaps even a right to reproductive freedom to be protected.  More below the fold.

Double Blind Politics

One of the consequences of uninformed and partisan politics is an enormous amount of cognitive dissonance.  Examples like the ones below make me wonder a lot how different things would be if we voted on policies rather than politicians.  No names and no parties attached to any proposal, just a list of ideas for voters to yay or nay. Just a couple examples of doublethink below the break:

On Government and the Free Market (part 1: Healthcare)

Generally, I'm a huge fan of the free market.  I think competition is a powerful force for good, and I'd like to see less government intervention in a wide variety of market activities.  However, whenever I talk about healthcare, I'm basically totally socialist.  Many people might see these views as inherently contradictory, but I'm not sold and this post is about why.

My views are held together by an understanding of the theoretical basis for the modern fondness for free-markets.  It's called Pareto Optimality, and basically what it means is that a Perfect Market  will (provably) reach an equilibrium where no one can possibly get any better off without someone else having things worse.  Zero-sum doesn't immediately sound exciting, but consider the alternative scenario in which many people are unnecessarily worse off and you might get a sense of why this result is a Good Thing.  I think (though I'm not sure), that this proof is part of the reason Austrians (EDIT: Austrians do not hold this belief.  For a fairly thorough primer click here) and other Libertarians are so fond of unfettered capitalism.  It is, however, worth noting that where that equilibrium is (in terms of final distribution of goods) depends on initial distribution of wealth, so even if we did have a perfect market we might have to think about setting up initial conditions properly so everyone was alive and moderately well at the end.

Now, before you get all worried about proper wealth distribution, please recall that our markets aren't perfect (obviously).  The question of why they aren't naturally leads to my beliefs regarding the role of government in the market.  A lot of the time, as libertarians are eager to point out, the government is the force moving markets away from their ideal.  They do this primarily by increasing the barrier to entry into various businesses.  Common tactics include patent law, licensing restrictions (especially zoning ordinances), quality controls, subsidies, tax codes, loopholes, and all sorts of other things.  When I get angry and yell about plutocracy in government, that's usually what I'm on about - wealthy corporations and individuals buying themselves special treatment... Unions and other powerful groups lobbying to entrench their interests (like cab medallions &c).  That stuff is bad news; we shouldn't put up with it.  It distorts outcomes, hides costs, and generally creates long term structural problems in the economy.  If you think I sound like a libertarian right now, it's because I agree with them totally on these points.

However, some markets aren't perfect for reasons completely separate from government.  Health Care appears to be one of those markets.  There are a lot of reasons for this, but the basic issue is that people can't really tell good care from bad.  This is particularly true of the very ill.  Sick people given the right treatment often die anyway, and sometimes very ill people get better despite bad treatment or no real treatment at all.  There's no clear signal of quality, and if consumers can't tell what's good, they very clearly can't effectively choose the proper treatment.  Patients can pick their doctors by bedside manner, but not by efficacy.  Furthermore (and this is vital), patients who need care most can't really make ANY choices about their care.  They may be unconscious, rushed to the nearest care provider, and subjected to whatever life-saving treatment the doctor on call deems necessary.  And then there's the problem of infinite demand.  Most people (rightly) value their lives over just about anything else.  Combine that with the fact that people are terrible judges of quality of medical care, and you can see why such giant amounts of money go into bad treatments.  How can a proper market operate under those sorts of constraints?  My answer, and Kenneth Arrow's (a Nobel Laureate economist who worked out some of the perfect market stuff I mentioned earlier) is that it can't.

But don't take the theorist's word, look at the facts.  The U.S. spends hilariously more money on health care than any other country -- with the most private system (though the U.S. health care market is also horribly burdened by government interventions... in particular drug patents).

 Our government, insuring just our elderly and very poor, manages to spend a larger share of GDP on healthcare than the Canadian government spends on every. single. Canadian.

This is insanity. You don't even have to look abroad to notice that the socialist way is better... take the VHA.  So when markets can't work like they're supposed to, I'm okay with government stepping in to do the job.

(If you're about to make claims about health outcomes in other countries, I suggest you read the linked articles first... U.S. health outcomes are generally similar to or worse than our socialist peers')

Next up: macroeconomic interventions

Health Care Costs

I saw this and had to post.  Yglesias (the blogger) sums it up very nicely, but here's the teeny-tiny executive summary.  The more consumer-driven health care is, the more it tends to cost.  I'm not really sure how making our healthcare system even more private is supposed to help given these trendlines.

Entitlement (edited for improvement)

EDIT: This post is badly written and reasoned.  I have other better opinions about this that I will one day expound upon.  I'm leaving this up as a sort of "history of Rory's thoughts" post, but it no longer reflects my views on this subject.

Today we will settle once and for all the argument about entitlement programs.  People hate these for all sorts of reasons.  Commonly cited:

1. We can't afford them
2. Big Government is bad
3. Government shouldn't enforce redistribution of wealth (related to 2); leave charity to the choice of individuals
4. Moral Hazard (Perverse incentive encouraging them what are poor not to do work)

In brief, my responses to 1-4 are as follows:

1. As they are now, agree
2. what does that even mean?
3. I am too angry to briefly address this, but it is stupid and I can prove it with Science and also Reason (related to 2)
4. Sure, there is moral hazard, but you know what else is morally hazardous? allowing innocent people to suffer and/or die when you could have given up money to stop it (related to 3, and 2)

Later, when I am less angry, I will write some stuff about how misguided beliefs 2 through 4 are.  For now, I will content myself with my proposal to remove the legitimate objection (that's number 1 for those of you who werent counting, or can't)

Once again, I propose a rights based approach.  Here's the deal: the thing I care about most is that people who are poor don't die or get sick or get injured on account of being poor.  I think that when that happens it is bad and also not good.  That's my primary concern.  So I figure, we should do with other entitlement programs what we've done with our most successful entitlement programs to date (education and the post), give them to everyone, everywhere, and make everyone, everywhere, pay for them.

In practice, I think it would look something like this:

1. Mail everyone a multi-vitamin with the stuff that peeps actually need in it (as much as medical science can anyway)
2. Mail everyone food stamps or maybe even actual food to the point where every person has the means of acquiring enough calories to be healthy
3. Guarantee FREE emergency and routine medical care (though only for bottom shelf medicines, treatments, &c)
4. Provide some baseline housing allowance to all people, payed directly from the government to the provider of housing (so the money can't be redirected to, you know, drugs or the like)

Please note that this system would apply equally to everyone.  Any purchases you made above and beyond this would of course be up to you, but there would be no reason for (for instance) health insurance companies to provide a basic coverage package, though there's still plenty of incentive to buy health insurance if you want to benefit from the pinacle of medical science and have the money to do so.  Furthermore, the government would be paying hospitals for all of their procedures, rather than forcing them to eat the cost of emergency medical care for the uninsured (as they currently do).  Likewise, the rich could put their housing allowance towards their second or third home, and would benefit as much (monetarily) as the poorest people.  The rich would also get their vitamins and food stamps, but would have the opportunity to go out and pay the premium on top of those food stamps to get nicer food or eat at restaurants and the like.

How would we pay for this? Taxes! and yes, stepped taxes, that means that the rich will pay out more in taxes than they take in in government living support.  On the upside, they will never ever ever have to feel guilty when they don't want to give a beggar money, on account of they KNOW BEYOND A SHADOW OF A DOUBT that that person has enough food, nutrients, shelter, and medical care. 

Incidentally, if we do this we can get rid of social security, medicare and medicade, which would be nice.  Since we're not providing any income or luxuries, people would still be motivated to find work, but if they didn't find work, no one's health would be at risk.  As a bonus, no one would ever die from neglect-by-society which, you know, could be cool.  Let me know what you think, and feel free to point out how I might be an idiot and am also almost certainly a communist.

EDIT: How does this save us money on entitlements?

This saves us money in a few key ways.  First of all, it lets us get rid of social security.  Secondly, it dramatically reduces the benefits provided to people (no cell phones, no cash-per-kid).  Thirdly, it eliminates the possibility of fraud and all of the resources that attempting to combat that would take up.  Fourthly, it simplifies the system, greatly reducing the administrative cost of running it.  The administration required to support such a system would basically be post office infrastructure, and maybe a way to connect landlords and their client's housing allowance.