Questions and Observations

Free Markets, Free People

Lord help us if he runs for governor

This is a commercial for Alabama Agricultural commissioner.  Ag commissioner.  You heard me, right – Ag commissioner. One of those high profile jobs.

This is a nuanced beauty of a commercial Think T-Rex in a sheep herd nuanced. See if you pick up on all the subtle signals he’s sending. Frankly, I enjoyed the hell out of given the gales of laughter it caused. Ah the state of politics today. Monitoring it you will never find yourself bored. And, I bet he wins the election as well:


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The theory of the “Howling Mob”

Like many of us, Michael Barone is puzzled by the administration’s obvious attempts to avoid linking Islam with the terrorists who have attempted to attack us.  He wonders:

Why the reluctance to state the obvious truth, that we are under attack from terrorists motivated by a radical form of Islam?

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Arab-American Miss USA

I note this for a single reason:

Fakih, an Arab-American from Dearborn, Mich., told pageant organizers her family celebrates both Muslim and Christian faiths. She moved to the United States as a baby and was raised in New York, where she attended a Catholic school. Her family moved to Michigan in 2003.

Pageant officials said historical pageant records were not detailed enough to show whether Fakih was the first Arab American, Muslim or immigrant to win the Miss USA title. The pageant started in 1952 as a local bathing suit competition in Long Beach, Calif.

How will the Arab nations accept Ms. Fakih’s win given she was seen “strutting confidently in an orange and gold bikini” during the contest?

Just curious.


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The problem with public sector unions

Anyone who has followed the financial woes of the states are able to trace much of it back to the explosion of public sector unions and the generous compensation and pension plans they enjoy. Each have become budget busters, with California alone looking at 500 billion in unfunded future payouts.

Mort Zuckerman explores that phenomenon and points to a particularly insidious relationship that exists between those unions such as the SEIU and politicians such as Barack Obama and many Democrats:

The business community and a growing portion of the public now understand the dynamics that discriminate against the private sector. The public sector unions organize voting campaigns for politicians who, on election, repay their benefactors by approving salaries and benefits for the public sector, irrespective of whether they are sustainable. And what is happening with California is happening in slower motion in the rest of the country. It must be one of the reasons the Pew Research Center this year reported that support for labor unions generally has plummeted “amid growing public skepticism about unions’ power and purpose.”

There has been a transformation in the nature of our employment. Labor is no longer dominated by private sector industrial workers who were in large part culturally conservative and economically pro-growth. Over recent decades public sector employment has exploded and public workers have come to dominate the labor movement. These public sector employees have a unique and powerful advantage in contract negotiations. Quite simply it is their capacity to deliver political endorsements and votes for the very people who are theoretically on the other side of the negotiating table. Candidates who want to appear tough on crime will look to cops, sheriffs’ deputies, prison guards, and highway patrol officers for their endorsement.

These unions and the politicians they support are selling out the states and the country for increased personal compensation and pension benefits in return for political office. Whereas public sector jobs were once among the lowest paid, they’ve become some of the highest paid with unsustainable pension plans a key feature. And when budget woes hit a state and any politician has the temerity to suggest cutting those plans or benefits, he or she is roundly shouted down and organized against at the next election.

Play ball with the unions, however, and they’ll organize for you, provide the key endorsements you need and participate in GOTV efforts on election day. This presents a problem which must be addressed and changed:

What we suffer is a ruinously expensive collaboration between elected officials and unionized state and local workers, purchased with taxpayer money. “Scratch my back and I’ll scratch yours.” No wonder the Service Employees International Union has become the nation’s fastest-growing union: It represents government and healthcare workers. Half of its 700,000 California members are government employees. More and more, it wins not on the picket line but at the negotiating table, where it backs up traditional strong-arming with political power. It spends vast amounts of money on initiatives that keep the government growing—and the gravy flowing. Similarly, for the teachers unions—with the result that California and its various municipalities, especially Los Angeles, face budget shortfalls in the hundred of millions of dollars. California can no longer rely on a strong economy to support this munificence. Its unemployment rate runs about several points higher than the national rate and its high-tech companies are choosing to expand elsewhere. Why stay in a state with such higher taxes and a cumbersome regulatory environment?

First pensions must be scaled back in the neighborhood of competative private sector pension plans. This is one of the reasons Greece is in trouble today.  The states can’t afford what they’re presently obligated to pay. Secondly they should go from defined benefit pensions to defined contribution plans like a 401k.  If it is good enough for the private sector, it is good enough for the public sector.  Third -salaries should be competative but not, like in New York, greater than equal private sector jobs. Government jobs are paid by private sector taxpayers.  The job of government isn’t to create government jobs, but to serve those taxpayers.  And I can’t imagine a reason such workers should receive better pay and benefits than those they serve.  Lastly, public sector unions must be reined in politically. Their influence, because of what and who they represent, is outsized and pernicious. 

This problem is perfect GOP fodder.  It is something which needs to be highlighted and fought.  It addresses the outrageous cost of government, the future liability of such compensation and pension plans and the effect of union politics on the taxpayer and the politicians who play along.  And, especially at state levels, they can point to this as some of the results of its continuance:

The lopsided subsidies for pension and health costs are a large part of the fiscal crises at the state and local levels. The subsequent squeeze on education and infrastructure investment is undermining the very programs that have made it possible for our economy to grow—thousands upon thousands of teachers let go, schools closed, mass transit slashed.

Tally ho!


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Observations: The Qando Podcast for 16 May 10

In this podcast, Bruce, Michael, and Dale discuss DADT, The Euro, and the spiraling cost of ObamaCare…even before we’ve gotten any of it.

The direct link to the podcast can be found here.


The intro and outro music is Vena Cava by 50 Foot Wave, and is available for free download here.

As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here. For podcasts from 2005 to 2009, they can be accessed through the RSS Archive Feed.

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BlogTalk Radio – 8pm (EST)

Call in number: (718) 664-9614

Yes, friends, it is a call-in show, so do call in.


DADT – time for it to go or should it be left in place?

The Euro Zone – doomed or will it survive?

ObamaCare – more surprises, more cost, more promises found to be smoke and mirrors.

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Forgive the schadenfreude

I just can’t help it – not that this is surprising or unexpected.

Venezuela’s economy is in trouble despite the country’s huge oil reserves. Blackouts plague major cities. Its inflation rate is among the world’s highest. Private enterprise has been so hammered, the World Bank says, that Venezuela is forced to import almost everything it needs.

This is socialism working again. Yes, yes, we’ll hear the naysayers claim that it “really isn’t socialism”, but of course, it is and, like all other attempts throughout the world and history, it is a dismal failure which has made the lives of the citizens of Venezuela worse, not better. Venezuela’s economy has contracted 3.3% in the past year.

Jose Guerra, a former Central Bank economist, says state intervention in private businesses is hitting the economy hard.

“The government is nationalizing, expropriating, or confiscating,” he says. “They are not creating new wealth; this is wealth that was already created.”

And, as expected, the government is badly mismanaging what it confiscates and nationalizes. Cities endure 4 hour blackouts daily, many during business hours.

This is not the way it was supposed to be. Venezuela is one of the world’s great energy powers. Its oil reserves are among the world’s largest and its hydroelectric plants are among the most potent.

But these days, Venezuela is being left behind: The rest of Latin America is expected to grow at a healthy rate this year, according to the World Bank.

Guerra, the former Central Bank economist, says the government must reconsider its policies — and drop the statist socialist model that Chavez adopted.

“The government has to consider that the socialist point of view is not so good for the economy,” Guerra says. “Chavez believes in the old-fashioned socialism. This kind of socialism is dead, definitely dead, it doesn’t apply to any country in the world.”

Of course it should be “dead, definitely dead” to the world, but it isn’t. Ignorant people like Chavez always believe that the myth of socialism and the supposed “social justice” it promises are workable solutions to what are the inequities and unfairness they see in a capitalist system. And when they finally grab power, they attempt to impose the promises of the myth with predictable results.

Of course, when committed this deeply, you don’t expect such a person to admit they’re wrong, but, instead to double down. Hugo Chavez doesn’t disappoint:

In a recent speech, Chavez acknowledged the economic troubles, but he said he wasn’t worried.

Instead, he spoke of a worldwide capitalist crisis, which he said provided a marvelous opportunity for Venezuela to push a new model.

Oh yeah, given the wreck that was Venezuela’s economy before the “capitalist crisis”, I’m sure there are untold numbers of countries just can’t wait to sign on to the “Venezuelan model” and all it promises:

The grill at Landi Nieto’s burger joint still works: It runs on gas. But customers eat in the dark, Nieto says, if they venture out at all in the first place.


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More “good news” about the health care bill’s impact

Remember the mantra that said, “once everyone has insurance, emergency rooms won’t be jammed as they are today”.

Says those who actually know about such things – “Wrong”.  In fact, they’re likely to be even more jammed than they have been in the past.   The reason?  The number of primary care doctors won’t change just because the number of insured have.

“Everybody expected that one of the initial impacts of reform would be less pressure on emergency departments; it’s going to be exactly the opposite over the next four to eight years,” said Rich Dallam, a healthcare partner at the architectural firm NBBJ, which designs healthcare facilities.  

“We don’t have the primary care infrastructure in place in America to cover the need. Our clients are looking at and preparing for more emergency department volume, not less,” he said.

But don’t take Dallam’s word for it – we’ve actually had experience that was apparently ignored:Massachusetts in 2006 created near-universal coverage for residents, which was supposed to ease the traffic in hospital emergency rooms.

But a recent poll by the American College of Emergency Physicians found that nearly two-thirds of the state’s residents say emergency department wait times have either increased or remained the same.

A February 2010 report by The Council of State Governments found that wait times had not abated since the law took effect.

Yes, it appears the public was sold yet another bill of goods.

Even the Chief Actuary at the Centers for Medicare and Medicaid Services is forced to grudgingly admit it:

Richard Foster, Chief Actuary at the Centers for Medicare and Medicaid Services, told The Hill that the current dearth of primary care physicians could lead to greater stress on hospital emergency rooms.

“The supply of doctors can’t be increased very quickly – there’s a time lag,” he said, adding, “Is the last resort to newly covered people the emergency room? I would say that is a possibility, but I wouldn’t say anybody has a very good handle on exactly how much of an infrastructure problem there will be or exactly how it might work out.”

Really?  Not enough doctors, everyone insured, Massachusetts example?  Of course they have a pretty good handle.

In fact, the American Institute of Architects predicts that the cost for hospitals could be in the $2 trillion dollar range over the next 20 years to meet coming demand.  Such building, at the moment, is pretty much on hold due to the economy.

The point, of course, is that access to insurance doesn’t mean access to a doctor.  And thus one sure way to see a doctor is via the emergency room.  Lack of insurance may have kept some away from seeking services there.  That won’t be the case anymore.  And, given the Massachusetts example, that’s proven to be true there.

So once again, reality meets a political promise and the promise is found wanting.

The cost of the bill, according to the latest CBO numbers, has now risen to over a trillion dollars in the first 10 years (bending the cost curve in which direction?  Up.), despite claims that it was under 800 billion, so the fact that this particular promise is wrong as well shouldn’t surprise anyone. 


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