Free Markets, Free People

Mickey Kaus


Quote of the day: Income inequality narrative killer edition

Mickey Kaus finds this from Tim Noah at The New Republic:

If you omit government redistribution from the calculations in the previous paragraph then four countries that previously were more equal in incomes than the U.S.—Portugal, Italy, Israel, and Germany—become less equal than the U.S.

Oh my.  And Kaus reacts with the qotd:

Wait. You mean that social-democratic, union-heavy, solidaristic Germany has worse income inequality, before taxes and transfers, than the cowboy capitalistic U.S., with its large underclass and out-of-control Wall Street greedheads? Don’t tell the narrative. …

Say it ain’t so!

~McQ

Twitter: @McQandO


Obama’s UAW speech fantasy, Kaus’s auto industry reality

Trying to justify the unjustifiable with a pep-rally like political speech to the UAW, Obama points to what he contends are the favorable results of his decision to intrude into the auto market and rearrange the bankruptcy process to favor his cronies.

I know our bet was a good one because I had seen it pay off firsthand.  But here’s the thing.  You don’t have to take my word for it.  Ask the Chrysler workers near Kokomo — (applause) — who were brought on to make sure the newest high-tech transmissions and fuel-efficient engines are made in America.  Or ask the GM workers in Spring Hill, Tennessee, whose jobs were saved from being sent abroad.  (Applause.)  Ask the Ford workers in Kansas City coming on to make the F-150 — America’s best-selling truck, a more fuel-efficient truck.  (Applause.)  And you ask all the suppliers who are expanding and hiring, and the communities that rely on them, if America’s investment in you was a good bet.  They’ll tell you the right answer. 

Of course Chrysler is now owned by a foreign auto company, courtesy of the Obama administration, Ford took no federal money and, had normal bankruptcy proceeded, taxpayers wouldn’t be out $80 billion dollars (still unpaid despite claims to the contrary) and a leaner, more competitive GM would be in existence.   Those suppliers would still be supplying and after the shakeout a more viable corporation would have come into existence.

uaw-gmInstead, the same GM is in existence boosted by taxpayer money.  As Micky Kaus points out, “You’d be successful in the short run too if the government gave you $80 billion dollars.”

Speaking of those GM workers in Spring Hill, TN, Kaus lays out another reality that the president doesn’t present:

Toyota and Honda are coming back online after the tsunami and Southeast Asia floods crippled production. VW is building roomy American-style cars in Tennessee using $14.50/hour non-union workers instead of $28/hour UAW workers. Hyundai is expanding rapidly. Competition is going to be vicious–it’s widely believed there’s still overcapacity in the industry. A new oil price spike could crimp sales of high-profit trucks. Will GM still be making money in 5 years? Or, I should say, will GM still be making money building cars in the U.S. (as opposed to importing them from China) in 5 years? I’m skeptical. I don’t think deficient corporate cultures change that easily. Normally we rely on the market to simply kill them off.

The two points to be made here are important.   One, GM’s current “success” is a result of huge infusion of taxpayer money.  Its problem was/is its corporate culture and its unions.  Neither problem have been addressed or fixed.  Instead, like Solyndra, they’ve simply been given an extension via the taxpayer that will eventually run out.  Secondly, as competing auto companies  using non-union labor continue to locate in right to work states and pay a competitive wage (but not the high end union wage), they will continue to take market share from GM, who is still stuck with that toxic corporate culture and grasping unions.

But, of course, Obama won’t care because he’ll be out of office.  This is the usual short term vote buying, just on a grander scale than we’ve ever seen it before.  Crony capitalism at its worst.

Long term viability?

Who cares?  Certainly not President Obama.

~McQ

Twitter: @McQandO


Ezra Klein Awaits Obama’s “Forceful Entry” Into Health Care Debate

As Mickey Kaus points out, Ezra Klein is into some heavy self-delusion if he really believes this to be true:

Since he didn’t forcefully enter the debate, the media reported on his news conferences and town hall meetings as if they were the White House’s failed attempts to set the agenda. Obama’s popularity has fallen and support for “his” bill — a bill that doesn’t exist — has plummeted.

Objectively, the fact that he hasn’t given a speech on health-care reform or defined his own bill or begun to really pressure the Congress means, in practice, that he has a lot left of tools left in his toolbox.

If Obama hasn’t “forcefully entered the [health care] debate” what was that ABC infomercial? What was the purpose of the series of town halls – if he wasn’t “forcefully entering” the debate.

In fact, Obama has been trying to push his health care agenda since he’s been in office.

Kaus reminds us of how involved to this point Obama has been in the topic of health care:

“Our CBS News tally shows that Mr. Obama has given 27 speeches specifically on his health care objectives. Add in other remarks, events and statements in which he mentioned health care and the number soars to 119.”

Those numbers flatly contradict Klein’s conclusion:

What’s not clear is whether he has the political capital left to use them effectively, or whether the last few months saw him robbed of something he hadn’t even had a chance to use.

Never had a chance to use? Hardly. Misspent, misapplied, squandered? More likely – it isn’t that he hasn’t taken the opportunities to “forcefully enter” the health care debate, it’s that he’s been completely ineffective when he has.

That’s why many don’t buy the David Axelrod spin which says, in effect, that has all proceeded as planned and now they’re merely going to “synthesize and harmonize these strands and get this done” with Obama’s upcoming speech.

Klein may believe that Obama is finally “forcefully entering” the debate with the upcoming speech, but I’d bet most Americans will see it as simply more of the same old ineffective nonsense wrapped in a new rhetorically glittering package that they’ve been hearing for months.

~McQ


The Health Care Presser

I loved a tweet that Jon Henke sent out last night during the Obama health care press conference.  It had me laughing – “Shorter Obama: you’re either with us or against us”.

In reality the press conference was the retelling of the same old nonsense. We’re going to expand the insurance system, require everyone be taken, no pre-existing conditions, no dropping you or denial of service. We’ll pay for it by finding some savings in waste, fraud and abuse, do health care delivery better than anyone else has ever done it, tax the rich and do it all – every bit of it – cheaper than it’s being done now, because we’re the government and we’re the experts in efficiency.

Tell me that wasn’t the crux of the presser?  Anyone left wondering why the majority of Americans are skeptical?

And of course we had the usual canards out there. The claim that preventive medicine is cheaper than medicine as it is being practiced now. Take a moment to read this post by a doctor who lays out the con in minute detail. Here’s another view. Here’s a fact no one seems willing to deal with – the vast majority of all health care costs come in the last 6 months of life.  No one has beaten death yet.  Ergo that fact isn’t going to change unless the entity with the money refuses to pay up.  So while preventive care may extend life, the cost of preventive care is more expensive and the end result remains the same.

As for paying for it,  the whole appeal, of course, was to give the allusion to the middle class that he and the Dems were all for soaking the rich to cover the cost, even talking about how taxing millionaires met his “principle” on that.

But as Mickey Kaus points out, you have to listen carefully:

I don’t want that final one-third of the cost of health care to be completely shouldered on the backs of middle-class families who are already struggling in a difficult economy. And so if I see a proposal that is primarily funded through taxing middle-class families, I’m going to be opposed to that …

Kaus points out that those two words, in “Wash-speak” mean he’s open to a middle-class tax to pay for the “new” and “improved” health care (49% isn’t “primarily”, right?).

And then there’s the dawning understanding around much of the country that this isn’t about reforming health insurance at all (something that might be appealing to most).  It is about a fundamental change in how health care is delivered. As the Republicans have begun saying, it is “experimenting” with your health care.

Can I guarantee that there are going to be no changes in the health-care delivery system? No. The whole point of this is to try to encourage changes that work for the American people and make them healthier. And the government already is making some of these decisions. More importantly, insurance companies right now are making those decisions. And part of what we want to do is to make sure that those decisions are being made by doctors and medical experts based on evidence, based on what works. Because that’s not how it’s working right now. That’s not–that’s not how it’s working right now.

Yes the government is already making some of those decisions. And the unfunded liabilities of the government system threaten to bankrupt us.

But the point remains that peppered all through the statement and answers was the phrase “health care delivery”.  That is one of the things driving down the approval ratings on the legislation.  Its one thing to say, “hey we’re going to eliminate pre-existing conditions, portability issues and denial of service while making sure everyone has insurance”.   It is an entirely different thing to say “we’re going to tinker with and change the way your health care is delivered”.

Now suddenly the government is in territory few want it in.  And that’s the overreach that Obama and the Democrats have committed that is driving the health care legislation approval numbers down.  Which gets us into the politics of this.

Obama said “this isn’t about me”.  But in fact it is all about him and maintaining his credibility.  But his problem, as usual, is he’s outsourced his signature agenda item to Congress.  Peter Wehner discusses the result:

On virtually every important issue — from the stimulus package, to cap-and-trade, to health care, to taxes, and more — Obama is ceding the agenda to the barons on Capitol Hill. And they will lead him over a cliff.

Why this is taking place is hard to know. It may be that Obama and Company are over-learning the lessons of the Clinton and Carter years, when relations with Democrats on the Hill were strained. It may be that Obama doesn’t like to immerse himself in the nitty-gritty of policy and is more comfortable deferring to those who do. It may be that the liberals on the Hill actually reflect what Obama himself — whose record as a legislator was, after all, markedly liberal — favors. It may be that Obama’s lack of experience is now showing through. Or it might be a combination of all four.

Regardless of the cause, the result will be damaging, and maybe even debilitating, to the Obama administration. All the campaign’s promises — about practicing a new brand of politics, finding middle ground, embodying hope and change — seem so old, so dated, and so cynical. Obama is turning out to be Salesman-in-Chief. But what he’s trying to peddle — an unusually liberal agenda and legislation that ranges from ineffective to downright harmful and reflects the desires of leading Congressional Democrats rather than the needs of the country — ain’t selling.

No, it’s not, thus the reason for the presser. As I pointed out yesterday, it is obvious at points he has no idea what is or isn’t in the bill. But what he does have a firm grasp on are his talking points, even if, as the days and weeks go by, they’re shot away or, at best, left hanging tattered and limp.

Speaking of politics, I love the attempt to take on the Republicans as the bad guys (one of the main Democratic talking points for days has been that the Republicans have brought no alternative to the table) and then this:

So, for example, in the HELP committee in the Senate, 160 Republican amendments were adopted into that bill, because they’ve got good ideas to contribute.

I’m not noting this with particular approval, I’m simply noting how this gives lie to the talking point.

To conclude, for anyone who has looked into the issue and followed the debate, such that is has been, Obama’s performance was anything but impressive. It was a mix of tired talking points and a con job – careful rhetoric that implied one thing while really saying something else (the middle-class tax increase being a perfect example).

But that doesn’t mean that some form of health care legislation won’t pass. I think, unfortunately, it will. And that is all about him and politics and he knows it. So do the Democrats. Clinton, Reagan, and GW Bush all passed their signature legislation before the first August recess in their first term. That isn’t going to happen in Barack Obama’s case. But he and the Democrats know that something they can call health care reform must pass or, as Obama is reported to have said, it will destroy his presidency.

To our eternal sorrow the fact that he’s right means the Democrats will do whatever is necessary to pass something to maintain his viability.

~McQ