Saturday, December 29, 2007

Conservatives Without Conscience

John Dean in his 2006 book of the above title states that what has driven him is the realization that our government has become largely authoritarian. From this premise, Dean proposed and documented two key points:
1) what is currently described as the “conservative movement” bears virtually no resemblance to Goldwater’s conservatism, and has nothing to do with restraining government power or preserving historical values. Instead, it has transformed into an authoritarian movement which largely attracts personality types characterized by a desire and need to submit to and follow authority.
2) because those who submit to authority necessarily relinquish their own conscience (in favor of serving the conscience of their leader and/or their movement), those who are part of this movement are capable of acts which a healthy and normal conscience ought to preclude.

Monday, December 17, 2007

Growth & Recession

The total US economy grows and is not in recession. Why then would a November survey by Rasmussen Reports show that 40 percent of respondents believe we are in a recession? Perhaps it is because the total hides the distribution of income. The Center on Budget and Policy Priorities finds that the share of the nation's after-tax income going to the top 1 percent of households hit the highest level on record in 2005. In contrast, the share of national after-tax income going to the middle fifth and bottom fifth of households was the smallest on record. The income of the bottom fifth increased five percent from 1979 to 2005, while the top one percent gained 228 percent. The people on the bottom have reason to believe we are in recession.


I recommend Paul Krugman's column in the New York Times Dec. 17. He is suspicious of politicians who campaign on bringing us all together. He argues that change will require confrontation and Edwards' anti-corporate rhetoric is appropriate. Krugman says, "There’s a strong populist tide running in America right now. For example, a recent Democracy Corps survey of voter discontent found that the most commonly chosen phrase explaining what’s wrong with the country was “Big businesses get whatever they want in Washington.”

And there’s every reason to believe that the Democrats can win big next year if they run with that populist tide. The latest evidence came from focus groups run by both Fox News and CNN during last week’s Democratic debate: both declared Mr. Edwards the clear winner."

Your Troublesome Economist tends to agree with Krugman.

Sunday, December 16, 2007

Food Safety

Are you as concerned about the safety of your food as I? There was a very scary story in the New York Times yesterday about contamination of fish grown in China's polluted waters. Over the past 10 years the number of imported food items has tripled while the Food and Drug Administration budget has not increased (just one instance of how domestic programs are suffering from spending on the pointless Iraq war). Only one percent of food imports are physically inspected.
Seafood imports have grown, but the shipments receiving laboratory tests have fallen to about a half percent in 2006. We need a risk-management system so that countries such as China with poor safety records receive more scrutiny. How hard is that? Obviously too much for an administration obsessed with Iraq.

Beholden to the Super Rich

Americans are beholden to the Super Rich. It is hard to explain why persons of average means defer to them. Cases in point:
1. The Senate recently voted to delete a House passed $250,000 limit of agricultural subsidies to a single person.
2. The Senate voted to kill a House passed removal of a tax subsidy for oil companies (as if their profits were not absurd enough).
3. Congress failed to eliminate the favorable tax treatment for hedge fund owners.
4. The income subject to Social Security tax remains capped at $102,000.
5. Michigan state income tax is not graduated.

There seems to be a dominant ideology that we working stiffs owe our jobs to the super rich so we must coddle them. I suspect part of the problem is that our new sources do not call attention to these super rich benefits. How many of the above were you aware of?

Saturday, December 8, 2007

Immigration Policy

In a Becker-Posner blog, Gary Becker objected to amnesty and instead proposed that illegal immigrants should be allowed to buy their legality by paying say a $10,000 fine. This is trumpeted as the Chicago principle of markets as the answer to many problems.
Instead of asking illegal immigrants to buy the right to stay, why not ask their employers to buy the right to keep them in the country? Doing so could free employers from any legal action against them for employing illegals.

Markets are wonderful, but the question is always who is the buyer and who the seller.

Fuel Efficiency Standards

The House voted for increased fuel efficiency standards, but the Senate has not. It is hard to believe that our domestic auto manufacturers cannot meet the proposed standards. We already have cars that can get 35 mpg, they are called small and light. If Toyota can make a profit selling these cars, why can't US auto makers? As someone observed, "What exists proves what is possible."
During the oil embargo, Clinton led us to a 55 mph speed limit. Such a limit for all relieves us all of the burden of trying to get one up on our fellows by more horsepower and size. Would the quality of our lives really suffer if we were more modest? Many Europeans seem to enjoy it.

Tuesday, December 4, 2007

Tomato Picker Justice

Migrant tomato pickers last week asked Burger King to pay one cent more per pound for their tomatoes in order to improve the lot of the workers. Burger King said it could not be sure the extra money would get to the workers. One suspects that if they wanted to, smart Burger King’s execs could figure out a way. I was surprised in reading comments on this story in the Naples News how many people begrudged paying the pickers more. They often said that the workers were mostly illegals and if they don’t like their pay, they can go home. So much for justice!
The workers rallied at the offices of Goldman Sachs in Miami. Goldman is a major shareholder of BK. The workers noted the irony of their pay compared to the millions about to be distributed as bonuses to Goldman’s managers. Did the clever work of any of these ever put food on our tables?

Corporate Board Elections

The Securities and Exchange Commission, decided last week not to change the current rules that govern corporate board elections. Incumbent boards don’t have to print the names of candidates nominated by dissident shareholders on the official proxy ballots sent to shareholders. The cost of a campaign to get visibility for their candidates means that shareholders unhappy about excessive CEO pay for example are at a disadvantage.
The way the economy works is a function of a lot of little rules that get little public debate.

Bravo Chavez

Populist leaders have always been a scary mixture of good and bad. Chavez’s attempt to gain even more power for himself is scary as is enlarged public ownership of business. However, his championing of the cause of the poor is admirable. The proposed constitution would have shortened the workday from eight hours to six, created a social security fund for millions of informal laborers, and promoted communal councils where residents decide how to spend government funds.
You have to have some respect for a man who can say he may have been too ambitious in asking voters to let him stand indefinitely for re-election and endorse a huge leap to a socialist state. I have not heard that from our own over-reaching president.
One can be heartened to see democracy working in more of Latin America.