Questions and Observations

Free Markets, Free People

Right Policies: Opting Out

Yesterday Jon Henke challenged the Right to come up with policies that are popular, viable, workable, transformational and sustainable. (Follow the link to see what he means by each of those.) I’ve previously suggested a broad-based agenda that I thought could be sold as an alternative to the Democrats’ agenda, but I think a few of the specific policies are particularly strong, and they stick to a consistent theme.

Libertarian paternalism — which means that certain initial decisions are made for you, but you are left a way to opt out — can be a good or a bad thing, depending on the status quo. If the status quo is freedom, I’d just as soon not add in an element of paternalism in virtually any case. But if the status quo is paternalism, then libertarian paternalism is a step in the right direction.  Fortunately, giving people more options is much more popular than changing their status quo decision.

I propose that the Right should target existing paternalism and offer as many opportunities to opt out as we can devise. My main two examples are education and entitlements.

Education

I consider education to be any political coalition’s #1 long-term priority. If your opponents control education, chances are you will eventually lose on everything else. So, what policies should the Right pursue on education?

Vouchers aren’t a new idea, but we on the Right could be pursuing them in much more creative ways than we are now, to build a broad working alternative to state schools.  With variable-cost vouchers and pilot programs that target the “victim classes”, the Right can play full court press on vouchers in every school district.

Variable-Cost Vouchers

In every school district across the country, we should have vouchers at least equal to the variable cost of sending one extra child to public school. Democrats have argued for a long time that we need more spending per student to give kids smaller class sizes and better materials such as textbooks, and have used that to justify countless bond measures and tax increases to increase public school funding.

If a voucher just covers the variable cost of an extra student, then a voucher helps create smaller class sizes and increases the amount of money the public school can spend on each student.

You can see how a voucher for variable costs puts the Left in a Catch-22: Every extra dollar they want to spend per student is an argument for a bigger voucher, and an opportunity for the private sector to spend the dollar more efficiently than the public sector.

Make Friends in Low Places

We can do even better: pilot voucher programs should very openly target kids who are performing worst in the current system, in part because proposing vouchers for them undercuts the argument that vouchers just skim the cream of the crop.

Voucher proponents have already focused on several low-income and minority populations, using needs-based criteria and simple geography; the Right should be pushing this smart strategy much more aggressively – it undercuts Democrats’ arguments against vouchers beautifully, and makes a direct play for the Left’s base. The apparent success of the DC voucher system has made attempts to cut the program very embarrassing for Democrats; we need more of that.

Moreover, the Right should propose vouchers that help children who score on the bottom half of the test-score distribution. The research I’ve read indicates that these children show the greatest gains from voucher programs.  For the same reason, target kids with histories of disciplinary problems and special-needs children (paging Sarah Palin).

It would be a bridge too far for the Democrats to argue that these kids enhance the performance of public schools after using the opposite argument to fight vouchers for so long.

And finally, the Right should propose voucher programs to target the many minors who have already dropped out of school.  Kids who have outright given up on the public school system, or who rarely show up, aren’t doing anything to improve the performance of those schools.  If Democrats want to keep up the pretense that they care about these kids, they shouldn’t have any problem with helping these kids become part of a new private education market.

Those are just a small number of ways we can turn the Left’s most popular arguments against them and start to build a real market in education. In the meantime, the Right would be demonstrating that markets can work better than state-administered programs, and help the “little guy” who’s been screwed by the public system.

Where necessary to make the policy viable, the Right could be flexible on the matter of vouchers for church-founded schools (like Catholic schools); the first priority is building a broad education market outside of the state.

Entitlements

Here’s another place where reform would be truly transformational. The Right should push for an opt-out for the major entitlements – Medicare and Social Security. A reform doesn’t have to be a full privatization to accomplish a great deal of good.

Many people are currently collecting benefits from Medicare and SocSec, and we can assume that they will turn out to vote against anything that takes away those benefits. The Right can start making progress on reducing our crushing long-term obligations by (once more for effect) giving everyone as many opportunities to opt out as possible.

Social Security

Why not allow people to adjust their expected benefits, with higher or lower individual taxes to compensate for the change from the “standard” level?  The SSA could set a minimum level of contributions to guarantee its promised benefits, so that the legislation becomes non-threatening to beneficiaries, and thus politically viable.  To get the greatest tax cut, you opt out of all retirement benefits; you can change your mind later, but your benefit and/or tax level must be adjusted appropriately.  And the more people who opt out, the lower the minimum tax rate can go; that rate could be adjusted at periodic intervals, perhaps once a year.

Similarly, why not allow people to adjust their expected retirement age, again paying higher or lower taxes to compensate?

Both of these adjustments would introduce flexibility along with a price mechanism.

Yes, this means that some people might choose to pay the minimum tax and find themselves at age 67 regretting their earlier decisions, but everyone would know that they made a conscious choice to change from the status quo.  And in the meantime, those who opt out don’t feel like such direct stakeholders.

Medicare and other state medical benefits

To get more people off the rolls, allow them to opt out of Medicare eligibility and other state medical benefits in exchange for some mix of:

    • lower payroll taxes
    • tax-free health savings accounts
    • a tax cut on their individual health insurance
    • vouchers for private insurance and private disability coverage

… as long as the total cost of the mix is lower than the expected cost of Medicare benefits.  This way, the Right can not only cut into the massive expected costs on the near horizon, but also get fewer people to feel like stakeholders in the future of the state-administered system.

Conclusion

The most effective arguments against reform are allegations that people will lose the benefits they have now. Psychologically, we regret losing a dollar more than we regret not acquiring that dollar in the first place. That’s a big part of how the Right beat universal health care under Clinton: by telling the American people that they would lose their current insurance, with which most of them were satisfied.

Whether we like it or not, it is stupid to do a frontal assault on a hardened position. Instead, we should apply libertarian paternalism to divide and conquer by giving our opponents as many chances to defect as possible.

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A Day With The Hurricane Hunters (update)

I had a unique experience this week.  That was the opportunity to fly with a very unique military unit. Unique in the sense that they’re the only one like it in the US military. I’m speaking of the 53rd Weather Reconnaissance Squadron, known as the “Hurricane Hunters”, based at Keesler AFB in Biloxi MS.

The opportunity was one I just couldn’t pass up, so on Tuesday, I and a few other bloggers from as far away as Chicago, hooked up with the 53rd for a 3 hour flight in one of their 10 WC-130J “Hurricane Hunter” aircraft.

crewOf course we were first initially briefed on the history and capabilities of the squadron. The squadron is comprised entirely of Airforce reservists. Yet they carry a full mission load. So in addition to their monthly training and their 2 week annual training, these folks average 120 more days of active duty time a year.

That’s a lot of time away from home for a part-time job. But they obviously love it. The pilot of our flight had been doing it for 17 years and the AWRO (Aerial Reconnaissance Weather Officer) said she’d been bashing her way into hurricanes for 23 years.

The normal crew for a hurricane mission is 5 (pilot, co-pilot, navigator, AWRO and loadmaster).  Depending on the length of the mission, which can last up to 12-14 hours, they may take a second crew with them.
at-work
Do they actually penetrate the hurricane?  Yes.  In fact they fly right through it, from side to side, through the eye.  Last year during the hurricane season, they made 162 flights through the eye of hurricanes.

Their work normally begins with a low-level investigation.  Naturally forecasters are intersted in what effect the storm is having at sea level.  So, if its a tropical storm, they may begin looking at it at 500 feet.  As it becomes a hurricane, they step their approaches up.  A Cat 1 may see them go in at 1,500 feet and so on.

They never go higher than 10,000 feet, even though these storms may be as high as 50,000 feet.  That’s because of icing primarily and lightning strikes secondarily.  Icing begins at about 14,000 feet.  So while they’re equipped to do deicing, it puts the aircraft at further risk that is just not necessary to do the mission.

When Katrina was building, these folks were flying through her at 10,000 feet and sending invaluable information back to forecasters.  Obviously their work has helped both forecasters and meteorologists learn a lot about the behavior of these storms.   But more importantly, the Hurricane Hunters have helped sharpen landfall forecasting by 30%.  What that means is when you see a storm track which shows where the hurricane might make landfall, it’s a 30% smaller footprint than it would be without the information the squadron provides forecasters.

It is estimated that it costs $1 million to evacuate a single mile of coastline.  That reduction of 30%, depending on where the storm is forecasted to go, can mean eliminating the need to evacuate 50 to 100 miles of coastline.  Or more simply said, because of that, the cost of all the missions they’ll fly in a year are normally paid for by the savings produced by one mission.

Their area of operations is from the international date line west of Hawaii to the Atlantic ocean.   That is a huge AO.  Additionally they fly winter storm missions as well.   In all a most impressive group.  If you’re interested, you can read more about them here.

Having taken the 3 hour flight (a simulated mission and a low-level pass over New Orleans), I’m now on a list to fly into an actual hurricane with them.  That’s just too cool.  So, with hurricane season starting on June 1st, I’m standing by and hoping for an opportunity (they said it could take up to 3 years) to snag one this year.

Update: I forgot to mention that there was TV media on the flight as well, and this was headlined as the “first blogger flight in the history of the Airforce”.  So we were as much the story to them as the flight was to us.  Here’s a local TV station’s treatment of the story.  I don’t know who the “Bruce McSwain” guy is, but what is he says is true.

~McQ

[Photos by Cindy Morgan]

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Newspeak Update: Spending Cuts = Dictatorship

Bizarro world continues unabated. The logic behind this assertion is … uh, “subtle” to say the least (my emphasis):

First, on “constitutional dictatorship,” there is, somewhat surprisingly, Minnesota, where Gov. Tim Pawlenty, a favorite of the Repblican right wing (assuming there is anything else than a right wing in the GOP these days) is apparently going to use all of his powers under the Minnesota have exercised such powers, but Pawlenty’s exercise in unilateral government seems to be of a different magnitude. Perhaps we should view Minnesota as having the equivalent of a Weimar Constitution Article 48, the “emergency powers clause” that allowed the president to govern by fiat. Throughout the 1920s, it was invoked more than 200 times to respond to the economic crisis. Pawlenty is sounding the same theme, as he prepares to slash spending on all sorts of public services. The fact that this will increase his attractiveness to the Republican Right, for the 2012 presidential race that has already begun, is, of course, an added benefit, since one doubts that he is banking on a political future within Minnesota itself (which didn’t give him a majority at the last election; he was elected, as was Gov. Rick Perry of Texas, only because of the presence of third-party candidates). One might also look forward to whether he will refuse to certify Al Franken’s election to the Senate even after the Minnesota Supreme Court, like all other Minnesota courts, says that he has won. Whoever thought that Minnesota would be the leading example of a 21st-century version of “constitutional dictatorship” among the American states?

I don’t know who Sandy Levin, the author of the above screed, is but I have to believe he has become lost in his own rhetoric. We are honestly being asked to accept the premise that a Governor, using his constitutionally-approved and legislature-granted powers, is somehow a “dictator” for … slashing spending in a time of budget shortfalls?

Gov. Tim Pawlenty promised Thursday to bring Minnesota’s deficit-ridden budget back into balance on his own if the session ends Monday without an accord, using line-item vetoes and executive powers to shave billions in spending.

[...]

Pawlenty held out the possibility of a negotiated agreement, but said he was prepared to use vetoes, payment suspensions and so-called unallotment to cut the two-year budget to $31 billion. That’s about $3 billion smaller than the slate of spending bills sent to him.

The move infuriated Democrats who run the Legislature. House Speaker Margaret Anderson Kelliher of Minneapolis dubbed Pawlenty “Governor Go It Alone.” Pawlenty shot back that without the step Kelliher would be “Speaker Special Session.”

“There will be no public hearings. There will be no public input. There will just be a governor alone with unelected people whispering in his ear of what to cut and what not to cut,” Kelliher said, calling it “bullying.”

Apparently this is exactly what Levinson and the Minnesota left want us to believe — i.e. that using duly constituted powers is the equivalent of behaving as a dictator. How utterly ridiculous.

If this were a situation where the governor was unilaterally deciding to burden the taxpayers more, or he was singling out a particular group of people to bear the brunt of arbitrary government rules, I could see where the dissenters here would have a point. If the executive branch suddenly declared, without any legislative input, that English was the official language of Minn. and no other languages would be recognized anywhere in the state upon penalty of law, then, legally granted powers or not, I would understand and support Levinson et al.

Instead, the perfectly preposterous idea that balancing a state budget, using the very powers granted the governor to accomplish the task, is now deemed the equivalent of the Weimar Republic emergency powers (you know, the ones that allowed Hitler to declare himself supreme dictator over Germany).

To be sure, the focus of this vitriolic (and, I’d say, hysterical) attack on Pawlenty stems from his threatened use of “unallotment” powers:

The procedure exists under state statute, and “the first prerequisite to unallotment is that the Commissioner of Finance ‘determines that probable receipts for the general fund will be less than anticipated, and that the amount available for the remainder of the biennium will be less than needed.”

Then the ball is in the governor’s court:

“After the Commissioner of Finance determines that the amount available for the biennium is less than needed, the governor must approve the commissioner’s actions before the commissioner can either reduce the amount in the budget reserve or reduce allotments.”

The Legislature is consulted but does not have any power or ultimate say in the governor’s actions. The process starts at the beginning of the next fiscal biennium, which means that Pawlenty won’t enact anything until July 1. And what he’ll do is anyone’s guess.

“Depending on what he does with line-item vetoes, I figure we’ll see anywhere from a half a billion to $2 billion in unallotments,” Schultz said. “It’s unprecedented in dollar amount and in willingness to use it.”

Is it good policy or politics?

Schultz points out that unallotment is on the books for “emergency conditions” in which “the Legislature can’t do its job,” such as a budget forecast that comes out when lawmakers aren’t in session.

But in Schultz’s opinion, Pawlenty is “creating the emergency conditions that allow him to use it.”

“He appears to not want to negotiate in good faith,” Schultz offered. “Working with the Legislature is supposed to be a cooperative venture, not a take-it-or-leave-it one.”

The problem, of course, is that the legislature keeps sending a bill that proposes more spending than Minnesota’s revenues will allow. Because the governor and the legislature can’t agree on identifying new revenue sources (e.g. Leg. wants to tax the rich, Gov. wants to borrow against tobacco settlement), then the two sides are at an impasse. Despite what some might say, a proposed $3 billion deficit with no budget alternative in place does represent a fiscal emergency. After all, the money has to come from somewhere, or the services (giveaways, or whatever) will have to be cut, and the government may be forced to shut down. Why that doesn’t represent a fiscal emergency of the very type contemplated by the unallotment statute remains a bit of mystery for us less hysterical folks.

Jumping out the weeds, and regardless of how one might view the necessity of spending more or less via the Minnesota budget, I am simply flabbergasted that anyone could possibly suggest that forcing the government to spend less is in anyway, shape or form equivalent to dictatorship. To accept such premise is accept the idea that government spending is the sole source of freedom. I categorically reject any such notion. And if dictatorship is to be defined as standing in firm opposition to it, then sign me up.

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GM To Be “Chryslered”

I hesitate to call it bankruptcy when it is really a sham of a bankruptcy. In fact, it is the same sham that Chrysler has undergone:

The government previously indicated that it planned to take at least 50 percent of the restructured company, and likely would take the right to name members to its board of directors, as it has at Chrysler, where the government will control four of nine seats.

The United Auto Workers retiree health fund is set to own as much as 39 percent of the restructured GM, in exchange for giving up its claim to at least $10 billion that the company owes it. Yesterday, the union announced that it reached an agreement with GM that will reduce the company’s labor costs.

Still unknown is what part the Canadian government might play in the ongoing GM restructuring.

GM operates several plants north of the border. The Canadians agreed to invest about $3.5 billion in the Chrysler restructuring and control one of the nine board seats.

Sound familiar? So government will now have 5 of 9 board seats, the union has a huge share of the company and bondholders?

The chief obstacle to an out-of-court settlement for GM remains: There has been no agreement between the company and the investors who hold $27 billion worth of GM bonds.

Under orders from the Obama administration, GM has offered to give the bondholders a 10 percent equity stake in the restructured company in exchange for giving up their bonds.

That’s the offer made and, as you might imagine, bondholders are resisting this. That, of course, gives the administration the same excuse it used to take Chrysler to bankruptcy under its apparently newly written rules which gave government the lion’s share of ownership.

As you might imagine, not everyone is happy. And since this “bankruptcy” is now being politically managed, more politicians are getting into the act.

For instance, on the subject of cutting Chrysler dealerships:

There are also challenges outside court. Chrysler has moved to close 789 dealerships on June 9. But Sen. Kay Bailey Hutchison (R-Tex.) has introduced legislation that would withhold federal funding if the automaker does not give dealers an extra 60 days to close down operations and sell remaining inventory. Her amendment has won the backing of a number of other senators.

Should such legislation pass, you can expect something similar with GM.

And some Democrats aren’t particularly happy either:

Judiciary Committee chairman Rep. John Conyers Jr. (D-Mich.) said he hopes to meet with White House officials today to discuss changing Chrysler’s bankruptcy plan and GM’s future. Conyers did not outline what he wanted, but a nine-person panel he assembled for a hearing yesterday offered a hint. Liberal consumer advocate Ralph Nader, a conservative Heritage Foundation analyst and minority auto dealers all criticized the automakers’ restructuring.

Conyers and other committee members attacked the administration for abusing bankruptcy laws, unfairly eliminating dealerships and jeopardizing consumer safety.

Yup, looks like the political bureaucracy is kicking into high-gear and you can just imagine how well this is going to work out, can’t you? That and the fact that contracts will never be viewed in the same light again have to make you fear for our economic future.

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Sin Taxes To Fund Health Care?

First they came after the smokers. But I didn’t say anything because I don’t smoke. And then they came after the soda drinkers, and I didn’t say anything because I rarely drink soda.

But then they came after beer, but I couldn’t do anything because the precedent had been set (with apologies to Pastor Martin Niemöller).

Yes, sinners, you are going to pay for health care. You and the evil rich. “Sin” taxes are seemingly the chosen method of this administration for paying the bill for the upcoming health care debacle.

Consumers in the United States may have to hand over nearly $2 more for a case of beer to help provide health insurance for all.

Details of the proposed beer tax are described in a Senate Finance Committee document that will be used to brief lawmakers Wednesday at a closed-door meeting.

Taxes on wine and hard liquor would also go up.

Apparently they’re still discussing sugary drinks as well (although it seems diet drinks are not yet on the table) because, you know, obesity is a problem and since government will be paying for all of this (can taxing Oreos be far off?).

But remember:

“If you make less than a quarter of a million dollars a year, you will not see a single dime of your taxes go up. If you make $200,000 a year or less, your taxes will go down.”

Unless, of course, you’re a smoker, a fattie or a boozer (or, heaven forbid, all three).

~McQ

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How…stimulating!

Apparently the Fed has decided that their doubling of the monetary base in the last 7 months has done so fantastically, that they’re ready to do more of it.

Some Federal Reserve officials are open to raising the amounts of mortgage and Treasury securities purchase programs beyond the $1.75 trillion that they have already committed to buying, according to minutes from the Fed’s April meeting.

Please pay no attention to the inflation lurking behind the curtain.  Our benevolent overlords have everything under control.  So, why more monetary loosening.

Officials, meanwhile, projected an even deeper recession than they expected three months earlier and a more sluggish recovery over the next two years as labor markets remain under pressure.

Huh.  So much for that “turned the corner’ crap from last month.  But that’s OK.  because, you see, if you’re in the middle of a bursted bubble cused by overly loose monetary policy in the first place, then the way to get back on track is an even looser monetary policy.  That’ll fix you right up, you see.

At least, that’s what the Harvard econo-boys tell us.  And they are, of course, the Best and Brightest.

Meanwhile, the DoL reports that weekly claims for unemployment for last week were revised upwards to 643,000, but this week’s numbers were only 628,500.  So, that’s a nice little downward tick.  Except that we’ve got all those upcoming claims from shutting down car dealerships for Chrysler and GM.  Let’s call that 2,000 dealerships with an average of–I’m just spit-balling, here–25 persons per dealership left unemployed.  Let’s call it 50,000 new claims ahead.

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The “Constitution” Question

David Axelrod, Obama’s senior adviser talking about the appointment of a new Supreme Court Justice and the Constitution:

President Barack Obama began interviewing potential Supreme Court candidates Tuesday, while a senior White House official defended the president’s stated preference for a nominee who will give the powerless “a fair shake.”

White House adviser David Axelrod said the U.S. Constitution, like any document of its vintage, must be subject to interpretation in a modern context.

“Fidelity to the Constitution is paramount, but as with any document that was written no matter how brilliantly centuries ago, it couldn’t possibly have anticipated all the questions that would be asked in the 21st century,” Mr. Axelrod said.

Barack Obama, today, talking about the prisoners at Gitmo and the Constitution:

But I believe with every fiber of my being that in the long run we also cannot keep this country safe unless we enlist the power of our most fundamental values. The documents that we hold in this very hall – the Declaration of Independence, the Constitution, the Bill of Rights –are not simply words written into aging parchment. They are the foundation of liberty and justice in this country, and a light that shines for all who seek freedom, fairness, equality and dignity in the world.

I stand here today as someone whose own life was made possible by these documents. My father came to our shores in search of the promise that they offered. My mother made me rise before dawn to learn of their truth when I lived as a child in a foreign land. My own American journey was paved by generations of citizens who gave meaning to those simple words – “to form a more perfect union.” I have studied the Constitution as a student; I have taught it as a teacher; I have been bound by it as a lawyer and legislator. I took an oath to preserve, protect and defend the Constitution as Commander-in-Chief, and as a citizen, I know that we must never – ever – turn our back on its enduring principles for expedience sake.

Per Obama’s speech, the Constitution apparently “anticipated all the questions that would be asked in the 21st century” when it comes to Gitmo. Yet there’s Axelrod, claiming it doesn’t cut the mustard when it comes to the job description or duties of a Supreme Court justice and implying we must turn our back on it for “expedience sake” and redefine the job (give the “powerless” a “fair shake” – the job of the legislature).

So, which is it?

~McQ

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“Cap And Trade” And Its Probable Results

The Heritage Foundation breaks ‘cap and trade’ down to 10 points you may want to consider:

1. Cap and Trade Is a Massive Energy Tax

2. It Will Not Make a Substantive Impact on the Environment

3. It Will Kill Jobs

4. It Will Cause Electricity Bills and Gas Prices to Sharply Increase

5. It Will Outsource Manufacturing Jobs and Hurt Free Trade

6. It Will Make You Choose Between Energy, Groceries, Clothing, and Haircuts

7. It Will Be Highly Susceptible to Fraud and Corruption

8. It Will Hurt Senior Citizens, the Poor, and the Unemployed the Worst

9. It Will Cost American Families Over $3,000 a Year

10. President Obama Admitted “Electricity Rates Would Necessarily Skyrocket” Under a Cap-and-Trade Program (January 2008)

So, what can you expect when they realize that number 8 makes it a very regressive tax?

That’s right, a subsidy will somehow become part of the arrangement. And who pays subsidies? What those who they arbitrarily determine can “afford” them.

Therefore, in addition to this:

fs_0028

Be prepared to actually pay more than that for those who can’t “afford” it (8), unless, of course, cap and trade has helped you achieve number 3.

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So Will The Federal Government Bail Out California?

Is it too big to fail? Megan McArdle believes the possibility certainly exists (I mean was Arnie really in DC yesterday just to see the sights). Says McArdle:

If the government does bail out the muni bond market, how should it go about things? The initial assumption is that they’ll only guarantee existing debt. Otherwise, it would be like handing the keys to the treasury to every mayor, county board, and state legislature, and telling them to go to town.

But once the treasury has bailed out a single state, there will be a strongly implied guarantee on all such debt. So you don’t give them the keys to the vaults, but you do leave a window open, point out where the money’s kept, and casually mention that you’ve given the armed guards the week off.

Of course the right answer is not to bail out either. Failure is a great teacher. And then there’s the moral hazzard angle.

But in this day and age, that’s approach is almost unthinkable apparently. Government, as we’re being told, is the answer to everything.

My fear, based on what the federal government has done to this point, is they’ll “hand the keys to the treasury” on both the muni bond market and the states (with bailouts). They have no business doing anything in either place, but we’ve already seen that the arbitrary assessment that some entity is too big to fail apparently takes priority over economic law.

Once a single state is bailed out, there is nothing to stop other states from making a similar claim on the treasury.

Should such a thing happen in either case (or both), Federalism, which is on its last legs anyway, will be officially dead.

~McQ

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Meanwhile In California …

The expected happened:

California voters soundly rejected a package of ballot measures Tuesday that would have reduced the state’s projected budget deficit of $21.3 billion to something slightly less overwhelming: $15.4 billion.

The defeat of the measures means that Gov. Arnold Schwarzenegger and the state Legislature will have to consider deeper cuts to education, public safety, and health and human services, officials have said.

Propositions 1A through 1E – which would have changed the state’s budgeting system, ensured money to schools in future years and generated billions of dollars of revenue for the state’s general fund – fell well behind in early returns and never recovered.

The only measure that voters approved was Proposition 1F, which will freeze salaries of top state officials, including lawmakers and the governor, during tough budget years.

Schwarzenegger, however, still doesn’t get it:

In a written statement Tuesday night, Schwarzenegger said that he believes Californians are simply frustrated with the state’s dysfunctional budget system.

“Now we must move forward from this point to begin to address our fiscal crisis with constructive solutions,” the governor said.

In reality it has nothing especially to do with the state’s “dysfunctional budget system”, but instead with the state’s profligate spending which has landed it in overwhelming debt. And the most “constructive solutions” would be to – wait for it – cut spending.

Why is it I have a feeling that such a solution will be mostly absent from whatever CA legislators come up with?

~McQ

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