Suppose you go to a restaurant by yourself and can order either the grilled chicken sandwich ($10) or the filet mignon and king crab ($40). Which do you pick?
Now suppose you go with a friend, having agreed in advance to split the bill evenly. Does your answer change? If so, why? Suppose it's a stranger and not a friend. Does your answer change? If so, why?
Now suppose you go with a group of 30 people, having agreed in advance to split the bill evenly. Does your answer change? If so, why?
2. Bridge to Nowhere
Suppose the 600,000 people of Alaska want to build a $300M bridge to nowhere. It will cost them $500 each to build it, but it's a pretty useless bridge, so that ain't gonna happen. They're not stupid, after all.
Now suppose they convince our good friend Congressman Don Young to slip an earmark into a federal spending bill. Now it costs each of 300M Americans $1 each. The bridge is still pretty useless, but, you know, if I'm an Alaskan, it only costs me $1, and I get a whole bridge out of the deal... this isn't sounding so bad.
If I'm a Californian, this sounds like quite a ripoff to me, but it's only $1. How much time and effort am I going to spend fighting something that only costs me $1?
on 99% of both the specifics and underlying philosophy.
The rub comes in, as I see it, is getting legislators and voters to understand these things on an intellectual level instead of on an emotional level. When issues such as cutting government functions come up, people tend to wonder how badly they'll be screwed by the change, or react emotionally in some variation of "but that's not fair to ____".
Perhaps the real issue is trust. I don't know if I personally have the level of trust in my elected officials to believe that they will stick with what's right and smart versus bowing to bigger ($$$) interests than me, nor that they'll ensure that the people's interests are served in whatever they do, especially if something goes wrong post-implementation.
I've been involved in lots of outsourcing in Corporate America. Usually, it sounds effective on paper -- cheaper, better, faster, less hassle -- but the reality always turns out differently. It usually ends up with less service at a higher price; sometimes it turns out so badly the entire project has to be yanked back. The sales pitch never turns out to match reality. Thus my hesitance to accept the "advantages" of privatization of key government services.
"Perplexity is the beginning of knowledge" -- Kahlil Gibran
to you in an economic sense (which I happen to agree and disagree with at various points, but I'll try to get to that later), but you skip over one of RDF's main points: how does your theory of small government reconcile 'social conservatism'?
He argues that conservatives want gov. to stay out of the way of business and economic concerns (which is nearly what you say in your diary), but you have no problem with it meddling in our social lives: abortion, religion in the public square, prohibition of homosexual marriage and drugs, and so forth.
Why does smaller gov mean only economics while diregarding its overreaching in other areas?
This question is very pertinent to you since you claim not to be a libertarian, but a conservative through and through.
For whatever reason, it seems that often when Republicans start talking about small government and fiscal responsibility and balancing the budget, they're gunning for some social service program to which they are ideologically opposed. Nevermind that the government is usually doing a pretty efficient job of running that program (for example, food stamps runs less than 5% net waste ). On the other hand, rampant waste in reconstruction spending is ignored or actively enabled .
So, it's not that liberals have a problem with discussing which government programs are efficient, or which ought to be handled at a lower level or privatized. It's just that we tend to be suspicious when Republicans, who have shown little to no restraint when it comes to spending in general, suddenly decide to be responsible stewards of taxpayers' money; experience has taught us that this is usually a convenient way to coverup their attack on a program they don't like. I think that genuine fiscal conservatives need to do more than cheer these ideologically motivated cuts and keep demanding Republicans make real attempts to cut significant spending and waste.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
Let's face reality: the family farm died years ago. Only a tiny fraction of Americans now works or lives on a farm. Most farming is done by large agricultural corporations.
About 97% of California's 74,000 farms are family or individually operated, with 76.6% organized legally as proprietorships, 14.6% as partnerships and 6.0% as family owned corporations.
About 5,000 of the largest farms (those with over $1 million in sales) account for 75% of all market value of agricultural products sold.
About 62,000 farms (84% of the total) have annual market sales of less than $250,000. Together, they account for less than 10% of the state's total sales.
Hmm, percentage wise in output they are suffering, but they still consist of the majority of farms. So far I'm not convinced that we should hurt these already struggling farmers further.
More from a 2000 study on Alabama's farming (which also shows statistics regarding US family owned farms):
Based on census figures, the business organization of farms?individual or family farms, partnerships, and corporations?changed little between 1992 and 1997 in Alabama, the Southeast, and the nation, with family farms continuing to dominate the major ownership and control of production agriculture. Based on 1997 census results, Alabama had the highest percentage of family farms, at 91%, followed by the United States (86%) and the Southeast (79%). The Southeast, meanwhile, had the highest percentage of farms as corporations (11%), followed by the United States (4%), and Alabama (1%).
The study also says the owner structure changed little from 1992 to 1997, so I would assume corporations did not wipe out family farms in the last 9 years.
Where are you getting your claim about corporations owning most farms from? I think this is a clever way of using the left's distrust of corporations to actually help corporations by stripping away the last vestige of help for family farmers.
The only issue I have with that statement is who sets the value of the benefit?
How much is a vibrant sustainable planet worth these days? Are they on sale at WalMart?
That alone points to every single environmental fight facing us. Let's use the Oil Industry as a further example. I postulate that if the Oil Industry spent more of it's money drilling in a safer and more ecologically friendly manner, there wouldn't be all that much opposition to drilling off our coasts (even here in CA) or in pristine places such as Alaska. Unfortunately for the Oil Industries side, they have a long track record of trying to extract maximum profits by skimping every place they can. Look at the Alaska Pipeline failures this year. BP hadn't sent a cleaner through their pipes, nor inspected them in OVER A DECADE. And this comming in on 6 years of ever increasing profits in that sector. They've shown us they can't be trusted with our sweet spots.
Can industry change and start practicing more environmentally friendly extraction & production techniques. Of course they can. You just have to convince the accountants and the idiots on Wall Street.
How much is 5 more years of your life worth? How about 10?
Family farms may be organized as proprietorships, partnerships, or family corporations. Nonfamily farms include those organized as nonfamily corporations or cooperatives, as well as any proprietorships, partnerships, or family corporations with hired managers. Most farms (98 percent) are family farms. Large family farms are often organized as family corporations, and these account for growing shares of farm sales, but?contrary to popular belief?the share of farms and sales accounted for by nonfamily corporations is small and has been relatively stable since 1978 (see fig. 3-5 ).
I think you fall under the category of 'contrary to popular belief'.
A report by economist Sir Nicholas Stern suggests that global warming could shrink the global economy by 20%.
But taking action now would cost just 1% of global gross domestic product, the 700-page study says.
Tony Blair said the Stern Review showed that scientific evidence of global warming was "overwhelming" and its consequences "disastrous".
I think it comes down to a question of values and who gets to set them. Short term benefits or long term benefits must be taken into consideration also.
Most farming is done by large agricultural corporations.
This statement would seem to be supported by your evidence, if 5000/74000 farms in CA account for 75% of all market value of agricultural products sold. That's not the same thing as saying corporations own most farms. Corporations own bigger farms. Agribusiness and all that.
Leaving aside the discussion of whether we should subsidize farming, there's no practical reason we couldn't target aid towards small family-owned farms.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
Hmm, percentage wise in output they are suffering, but they still consist of the majority of farms. So far I'm not convinced that we should hurt these already struggling farmers further.
I agree that perhaps we could implement a progressive tax on corporate farms/larger family farms or regressive subsidy on smaller family farms. If 62,000 farms are the majority of farms, but producing only 10% of output while 5,000 produce 75% of output, these smaller farmers are the ones that deserve the help.
Anyway, I think his phrasing was intentionally ambiguous to lead to his desired conclusion, and it is clear that the family farm (or even small family farm) is not dead.
1. Cost/benefit. This only makes sense if you can accurately define what the benefit is. For example government programs like the CCC and WPA during the depression put lots of people to work, some of them doing "non-productive" work like painting murals or putting on plays. The goals were only indirectly economic. Yes they got a salary, but they also got a sense of purpose and their pride back. Cost/benefit implies that the only measure of success is that used by private industry - profit.
2. Level of government. Most government programs are run at the appropriate level. Those that are too big get bumped up. If you resent government setting national standards (say for education) then that is a philosophical issue, not a practical one. We have seen many cases where letting local governments do things produces undesirable effect (Jim Crow).
3. I spent my entire working career (as did my wife) working for non-profits. I think they can provide a useful bridge between government and private business. Unfortunately over the past several decades many of them have been converted to for-profit firms (Blue Cross) and the results have not been for the best (40% increase in premiums). A result of "cost/benefit". The cost goes to the people, the benefit to the new owners.
4. Government programs are cheaper and more efficient than most private firms. Government salaries are a fraction of those in the private sector. That there may be some abuses doesn't change the general picture.
5. The rule of law gets broken by the rule of "might makes right". Those breaking it can come from any sector (Microsoft, Standard Oil).
6. Tax policy is used in many cases to influence public behavior, not as a source of revenue (cigarette taxes). Whether this is philosophically "pure" or not is an open question. It is easier for politicians to pass a new tax then to pass a law regulating behavior. Is this cheating? Yes. Is it practical? Yes. Is it overused? Sometimes.
The problem with philosophies of government is that they fail in the real world where pressures are applied. That is why an alert population which has democratic power is the best way to correct things when they go wrong.
I appreciate your attempt to formalize your position. But you need to realize the world is imperfect and that what may seem like a good ideal needs to be compromised by what can actually be done.
1. All government programs must be justified on a cost-benefit basis. Programs that are ineffective or that don't produce results need to be fixed or scrapped.
Agreed, no issue here. I find though that, practically, even small goverment conservatives tend to weight things based on emotion rather than numbers. Take the Ballistic Missile Defense. It is an utter waste. With over 100 billion dollars (and another 10billion a year average) and two decades of work the thing can hit a known target with a track device on board maybe one out of three times. It is a total waste. Even if it worked as designed the russians already have a missile that would defeat it.
And yet where are the conservatives calling for it to be scrapped? I haven't seen any and I'd welcome them with very open arms.
2. Government programs should be run at the lowest/smallest/most local level of government that is feasible for the task at hand. Better to do things at the city level than the county level; the county level than the state level; and the state level than the federal level. Of course, some things *must* be federal, like national defense, but in general, small government conservatives are skeptical of federal involvement.
Agreed again.
3. Sure, there are many problems in our society, but sometimes government is the wrong vehicle for solving them. Many problems are better solved by the private sector (whether for-profit or non-profit) than by government. Some problems are fundamental to human existence and are altogether impervious to being "solved."
Agreed if we changed "many problems" to "A very few problems..." The private sector has a horrible record of dealing with problems. They have been terrible in the energy sector (think Enron). Terrible in the prison sector (think Wackenhut). Terrible in the military sector (think Halliburton). In fact I'm hard pressed to think of a single problem that the private sector has tackled and not completely screwed up.
Think about all the big advances. All of them have come from either academia (which of course is government supported) or the government itself. Internet? Government. Space program? Government. MRI? Academia. And so on...
Where are these problems the private sector has handled?
4. The government should be a wise steward of taxpayer dollars. The government ought to run a balanced budget or a nearly balanced budget except in severe emergencies. It should not overload itself with debt or do anything that would jeopardize its credit rating. It should use honest accounting principles and audit its operations regularly for waste and fraud. The government programs that we do choose to fund should be run efficiently and transparently, and government employees should act in a manner fitting of public servants (we, after all, pay their salaries).
Total agreement. In fact I mentioned before that I support writing a constitutional amendment to require the government to run a balanced budget except in times of declared war or national emergency.
5. Government should act as an impartial arbiter between competing interests, rather than picking sides and choosing winners and losers in society. The rule of law must prevail over the rule of men.
Not with you here. The rule of law should be equally applied but the law itself may fall more heavily on some. For example a progressive tax code should be applied to all (everyone pays taxes) but due to the structure of the code it will require the wealthy to pay more. Just as a law against murder will affect murderers more than non-murderers.
6. Taxes are necessary to fund government, but they should be designed in such a way as to cause the smallest possible amount of harm to the economy. For example, it is better to have low tax rates with few or no deductions than high tax rates with all sorts of deductions; small government conservatives would rather have lower income tax rates across the board than have deductions like the home mortgage deduction that favor one group (homeowners) over another (renters). (See also point 5 on this one -- what business does the government have favoring homeowners over renters in the first place? This reeks of "picking winners and losers" rather than being an impartial arbiter.)
I don't necessarily agree. Your position here seems predicated on the idea that the private sector works better than government but as above that simply isn't true. The private sector is by and large much worse than government in terms of using resources efficiently. Health care is a perfect example of this. We spend way more on medicine than those countries that have socialized health care and get less in return for the cost. All because we are paying for countless redundant company programs rather than a single centralized system with one administration.
Here is how I would rewrite this bullet: Taxes are necessary to fund government, but they have to be justified in terms of what value a citizen gets in return.
This then becomes the counterpoint of bullet number 1: government needs to have cost efficient programs and these programs need to give a return to the citizens commensurate with what they cost the citizen.
would argue about reducing pork barrel projects. Good riddance.
It is when you try to use this analogy to other social programs (education, medicare, etc) that it is no longer 'filet mignon and king crab'. Maybe a more apt analogy for the social programs most liberals/democrats concern themselves with would be pork and beans and a slice of bread.
Yes, economic conservatives *have* been quite pissed off. The only question was what to do about it -- whether to vote "in protest" for D's or whether to vote "for the lesser of two evils" for R's.
VAT's are almost National Sales Tax except on everything.
My GOD! Here we have a conservative who is calling for A BRAND NEW TAX to be paid by EVERYONE! what? The poor would pay more with a VAT? Well, why didn't you say so?
The classical alliance between conservatives and libertarians dating back to circa Barry Goldwater, "fusionism", attempts to answer this question.
Liberals may not realize that social conservatives are split on the issue of federalism. Many social conservatives would prefer *NOT* to pass the Federal Marriage Amendment -- they really *don't* want to "tamper with the Constitution" if they don't have to. But they also fear that liberal judges will "discover" a right to gay marriage hidden in the Constitution, just as previous judges "discovered" a right to abortion and a right to sodomy.
Yes, they want prayer in schools, but few want prayer in schools *imposed* by the federal government. Their greater fear is that government-run schools will *stamp out* existing expressions of religion that have been common in schools for hundreds of years -- that's one of their main motivations behind supporting homeschooling and school vouchers.
Fusionism means that the "libertarian" and "social conservative" wings got together and said: we *both* can agree on the points such as the following.
- Federal involvement in things like welfare and education is bad.
- Liberal judges' decisions like Roe v. Wade are bad -- this issue should have been left to the states.
- Taxes are too high and are stretching families' budgets and hurting the economy.
Fusionism falls apart if social conservatives insist on federal involvement in the Terri Schiavo case, or if libertarians insist that we should pass a constitutional amendment that *does* guarantee a right to abortion. Otherwise, social conservatives and libertarians really *ought* to be able to get along with each other.
Now, am I a "libertarian?" Depends on the definition of the term, but I *do* support at least some "social conservative" positions. I oppose gay marriage *and* civil unions, for example, and find the Federal Marriage Amendment distasteful but yet worry that it is necessary. I don't think the Constitution guarantees a right to abortion or sodomy. I don't think we need to remove the word "God" from the Pledge of Allegiance or our currency. I disagree with those who want to outlaw abortion, but also respect them for taking what I consider a valid point of view on the topic.
Where I depart from social conservatives is when they try to stick the federal government into things like the Terri Schiavo case or talk about passing laws that curtail the jurisdiction of federal judges. But I also depart from libertarians on the Patriot Act and many other civil liberties issues.
...conservatives *don't* consider those social programs to fall into that category. They think some of those programs cause more harm than good, and that many of the others are ineffective at best based on the amount of money we are spending on them.
They think some of those programs cause more harm than good, and that many of the others are ineffective at best based on the amount of money we are spending on them.
Exactly which programs are causing harm? Which are ineffective (I assume you mean inefficient)? Libertarians don't like social insurance because of the mistaken belief that they are smarter/better/luckier than the rest and thus will not need them in the future. Not believing in shared risks is one of the ugliest aspects of the "everyman for himself" mindset behind libertarian thought.
Reagan's theme about welfare moms driving in Cadillacs was false. Similar claims about people using food stamps to buy drugs have not been true or have represented a very small number of cases. Head start is a success. It is the later years of schooling (provided by local funds) where these kids fall behind.
You failed to respond last time to my list of social programs which were all performing well and supported by the majority of the public.
There is also no evidence that local government performs better than the national. Dislike of the federal government seems to be a visceral response based upon nothing tangible.
In this case, I don't think there is ANY government need to control the relative sexes between a married couple. So I'm willing to accept the "necessary evil" of a State or Federal Court from noting that the government has no place in that decision just as you are willing to accept the necessary evil of Constitutional Amendment to in order to grant the states the power to ignore equal protection requirements.
We both see our view as the 'status quo' and need just a little bit of government power to protect us. And be careful about dissing "discovered" rights, unless you are willing to defend miscegenation laws as within the right of the states.
I think you are falling for the classic mistake of mixing up "Republicans" and "conservatives."
I think that genuine fiscal conservatives need to do more than cheer these ideologically motivated cuts and keep demanding Republicans make real attempts to cut significant spending and waste.
We conservatives *ARE* doing that.
Conservative Republicans *did* make a very serious attempt to do that this last year, in the form of the RSC substitute budget:
Boehner allowed the RSC budget to come up for a vote. It failed 94-331, with all 94 "yes" votes coming from Republicans. Here was the tally: http://clerk.house.g...
I think it would be safe to say that any Republican who opposed the RSC budget is *not* a committed "small government conservative." And indeed, I gave money to a conservative candidate (Tim Walberg) who successfully unseated one of these liberal Republicans (Joe Schwarz) in a primary and then won in the general election on Tuesday. I've donated to numerous other conservative candidates in the last -- some who won (e.g. Tom Coburn), some who lost (e.g. Pat Toomey). I am doing my part! I have been putting my money whether my mouth is. I have been doing what I can to force my party to move rightward on economic issues.
The conservatives I follow were all strong supporters of the RSC's effort to pass this alternative budget and of the RSC's previous efforts, such as their earlier "Operation Offset" to balance Katrina reconstruction spending with other cuts elsewhere. They were also strong supporters of Jeff Flake's 19 anti-Pork amendments and Tom Coburn's anti-Bridge-to-Nowhere amendment.
Some may laugh at these efforts as irrelevant, but Operation Offset was the direct antecedent to the 2005 Deficit Reduction Act, the first mandatory spending cut bill to pass Congress in some years. If it hadn't been for Operation Offset and the tireless efforts of Flake, Coburn, and others, the Deficit Reduction Act would never have happened.
And now, Mike Pence, chair of the RSC, and John Shadegg, a very visible member of the RSC, are running for minority leader and minority whip, and have already picked up *very* strong support from conservatives.
* Both Mike Pence and John Shadegg voted for *ALL* 19 Jeff Flake anti-pork amendments.
* Both Mike Pence and John Shadegg voted *AGAINST* the Medicare prescription drug bill.
* Both Mike Pence and John Shadegg voted *AGAINST* No Child Left Behind.
* Both Mike Pence and John Shadegg voted *FOR* the RSC substitute budget.
You will not find many other folks in Congress who are on all four of those lists.
Unlike Hastert and Blunt and to a lesser extent Boehner, these guys are the real deal. Mike Pence has even referred to himself as a "Club for Growth experiment gone bad."
I don't think I was mixing up (fiscal) conservatives and Republicans, just suggesting that Republicans tended to get fiscal conservatives to sign on to their ideological cuts by selling them as spending cuts. I wasn't trying to denigrate the efforts of genuine fiscal conservatives -- it's nice to see them looking to regain influence in the Republican party. I hope Pence and Shadegg get those positions, I know they are highly thought of in the blogosphere anyway. And I'll be happy if my comment turns out to only apply to the past and is no longer relevant to the future.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
In a minimal sense, there certainly *are* still family farms. But they are swimming against quite an upstream current. It is very hard to compete with the economies of scale of large agribusinesses. As one actual Wisconsin dairy farmer told me some years back, he's not in it for the money any more -- he's in it because it's what he loves to do. (His milk business had gone south, and his farm was being kept alive mostly because he had gotten into the breeding business -- selling his best milk-producing cows' DNA.)
As your link noted, the number of farms declined 0.7% nationwide from 1992 to 1997. Further, at least in Alabama, "the proportion of farm operators who considered farming as their major occupation declined." This is all *despite* continued farm subsidies.
Agricultural-sector employment fell from 2.9M to 2.1M between 1994 and 2004, and was expected to fall further to 1.9M by 2014 (http://www.bls.gov/n... ).
If farm subsidies were eliminated, how many of these family farms would be economically viable? I don't know for sure, but I suspect a large fraction would not be. Many farmowners would probably sell out.
I'm don't see why we should be helping farmers, *period*. Why are we using the power of government to confiscate money from urban and suburban dwellers (such as myself) to give it to rural farmowners? Why is their lifestyle so particularly deserving of our government's favoritism? This violates my principle (5) -- "picking winners and losers."
Or, put another way: why should the 99% of the US population that is *not* employed in the agriculture industry have its money forcibly confiscated from it in order to subsidize the <1% of the population that is? Is this not a classic example of a "special interest group" demanding unfair special government favoritism, contrary to the public interest?
If a farm is only being kept alive by farm subsidies, it is an economic failure. It *SHOULD* be allowed to fail, so that the capital tied up in the farm can be reused for other, more efficient purposes. If that means that the family farm finally *does* go away, so be it.
Nowhere did I say anything like "the environment is worthless" or "the only benefits that count are monetary" or "we should sacrifice our long-term interests for short-term benefit." I, and the vast majority of small government conservatives, would in fact *disagree* with all three of these statements.
It may be tempting to throw the "you only care about money! what about *people*?" epithet at us, but it just ain't so. Small government conservatives are most certainly *not* out to ruin everyone's lives.
Indeed, it would be very hard to reconcile your statements about despoiling the environment and all with the fact that I support carbon and other environmental taxes (though with some caveats regarding how they are administered).
Between non-family farms and "very large" family farms it looks like we have accounted for fully 50% of agricultural production. Add in "large" family farms and they quote the number at 68%.
Fully 40% of the *number* of farms are "residential" farms, those defined as "small farms whose operators report a major occupation other than farming." Another 15% are "retirement" farms. Less than 25% of farm production appears to come from "farming-occupation small family farms."
The trouble here is the confusion between what the average person thinks of when you think of a "family farm" vs. the modern reality. When someone says "family farm", it conjures up the image of a guy in Iowa whose family has lived on the same plot of land since 1880 and who gets up at 4 AM every morning with his teenage son to milk the cows.
That's not exactly how it is any more. A "very large family farm" may be *owned* by a family, but with sales of $500K a year or more, these are serious businesses.
That classic stereotype really only fits the "farming-occupation small family farms."
I mean, Koch Industries is a "family business"... owned by the Koch family. It also happens to have $90 billion in annual sales and 85000 employees (http://www.forbes.co... ).
By no means am I in favor of exempting military spending as an area where we need to be watchful. In fact, if you look at the RSC budget, you will find that it makes several concrete proposals on how to cut the DoD budget. These cuts add up to about $17B over 5 years.
Conservatives have also cheered things like the elimination of the Crusader artillery system.
At the same time, we do have to remember that military spending is about 4% of GDP, while non-defense spending (excluding interest on the debt) is about 14.5% of GDP.
IF WE ASKED Congress to spend billions making the newspaper business a risk-free enterprise, our editorial would be laughed out of the Capitol. Yet that is essentially the deal American farmers -- and the insurance companies that profit from their government-sponsored premiums -- get from the federal government every year. The result, according to a two-part Post investigation published this week, is billions of federal dollars wasted in unfair and uncompetitive handouts, many of which go to farmers working land that would be left fallow in a freer market.
Even though Donald R. Matthews put his sprawling new residence in the heart of rice country, he is no farmer. He is a 67-year-old asphalt contractor who wanted to build a dream house for his wife of 40 years.
Yet under a federal agriculture program approved by Congress, his 18-acre suburban lot receives about $1,300 in annual "direct payments," because years ago the land was used to grow rice.
Matthews is not alone. Nationwide, the federal government has paid at least $1.3 billion in subsidies for rice and other crops since 2000 to individuals who do no farming at all, according to an analysis of government records by The Washington Post.
Some of them collect hundreds of thousands of dollars without planting a seed. Mary Anna Hudson, 87, from the River Oaks neighborhood in Houston, has received $191,000 over the past decade. For Houston surgeon Jimmy Frank Howell, the total was $490,709.
There's a reason I keep bringing up farm subsidies as an example -- they really are, as government programs go, about as close to a complete taxpayer scam as you're going to find.
I usually take issue with something you say, and you take my response and stretch it to places I had no intention of going.
For example, I'm not a fan of (most) farm subsidies. I too think the majority of them are a form of corporate welfare. I think the original purpose was well intentioned, but for the most part that reason is now obsolete. I do think a fair transition to eliminating the program altogether would be first to implement a regressive subsidy for small family farmers. This would allow families who've worked the land for generations to compete. Perhaps a time line is also necessary that would phase them out altogether but would also allow the small family farms to gauge whether or not they should remain in that occupation without leaving them immediately homeless. Was this the main point (or even a substantial subpoint) of any of my responses? No.
What I did take issue with was your phrase stating that "the family farmer died years ago." Production? Admittedly, they are in the minority. The majority of farmers? Yes. So I thought your statement a little disingenuous. That was my main point. They are not dead as far as number of farmers are concerned. They are still considered the majority of farmers, but not the majority in farming. I think 'dead' then might be a stretch here. I'm not really in favor of farm subsidies, but I do think you should present your arguments a little more fairly and accurately.
If in your small govt world I save $500 in taxes but end up paying $5000 for tolls, health care, school, property taxes, road taxes etc, i would rather give back the $500 tax cuts I save rather than spend more money.
I didn't get that out of your replies -- the impression I got was that you were defending farm subsidies on the grounds that there really are a lot of family farms out there.
Yes, "the family farmer died years ago" is a bit of an exaggeration -- mocking the absurdity I see in the arguments used to justify farm subsidies. I just find it extremely frustrating how many tax dollars I pay into the system, only for it to be frittered away on this sort of junk, with the arguments offered in favor of the spending so ridiculously flimsy. Government spending gets me seriously *angry*.
My approach to farm subsidies would be very simple -- slash them by 10% each year until after 10 years they're completely gone. No distinguishing between various classes of farmers. Just plain old "sink or swim."
Cost/benefit implies that the only measure of success is that used by private industry - profit.
No -- what it means is that we have to be *quantitative* about things, and that results are more important than intentions.
A simple example is to compare the effect of the following two policies:
- Increasing CAFE standards by 10 miles per gallon
- Raising the gas tax 50 cents per gallon and sending every American an annual rebate check using the proceeds
(feel free to tweak the numbers 10 and 50 a bit if you want; the exact numbers aren't what is important)
The former policy is ineffective/inefficient; the latter is effective/efficient. The proponents of the former policy may have good intentions, but those good intentions count for very little, because the policy they are promoting is clearly inferior to an alternative policy. (Without going into all the details, the fundamental flaw of the CAFE standards is that they only affect new cars; unlike gas taxes, they do not affect the incentives of existing car owners to get rid of their current cars sooner in favor of newer, more efficient cars. I would be happy to elaborate further in another thread.)
A proponent of a program may certainly claim that the benefits of the program are "a sense of purpose" or "pride." But how are we to weigh the value of these claimed benefits? Are we to merely take the proponents of the program at their word, regardless of how many taxpayer dollars they are asking us to appropriate?
No matter how great a program sounds in concept, there is a cost beyond which it just ain't worth it. I made this point in another thread in terms of saving lives. Is it worth $100K to save a life? Sure. Is it worth $10M? Maybe. Is it worth $1B? No, it isn't.
To make such decisions, we need to move beyond the qualitative into the realm of the quantitative. This is necessarily at least somewhat subjective, but not completely so. For example: is it worth (say) $1B to give 100 people a "sense of pride?" No, it isn't.
The CCC or WPA may well have given some people a sense of pride. The taxes required to finance these same programs may also have caused someone else to lose their job. FDR may have had "good intentions" in promoting programs like the CCC or the WPA, but when it comes down to the cold hard facts of the matter, it's not at all clear that these programs were wise uses of taxpayer dollars or a net benefit to the country.
You are welcome to claim that a policy offers benefits that are intangible in nature. Just be prepared to face skepticism from folks like me who question whether how real these intangible benefits are, and whether they're worth shelling out my cold hard cash for. I am, after all, the sort of "practical" person who drives about as boring a car as you can get: a Toyota Corolla. No, it isn't the "coolest" or "hippest" car out there, but is "coolness" or "hipness" worth my spending an extra $10K on a car? In my opinion, no. (I made the purchase based on tangible factors such as reliability, price, fuel efficiency, interior room, 4 doors vs. 2, etc. Coolness and hipness did not enter into my thinking.)
Most government programs are run at the appropriate level.
I find this fairly implausible. See my comment elsewhere in the thread on "The Restaurant." When you get to split the cost of something among a larger pool of people, you have an automatic incentive to be wasteful, and the *other* people have a reduced incentive to crack down on your waste. The filet mignon and king crab sounds steep at $40 instead of $10, but if there are 30 people splitting the check, it only costs you an extra $1 to splurge, so why not? And the other people only have to pay an extra $1 for your choice, so they aren't going to make that big a fuss over it. Compare to if it's just 2 people, where your friend might be pissed off at you that you made him shell out an extra $15 for *your* dinner.
(In game theory, "The Restaurant" is a classic "Prisoner's Dilemma" situation.)
Running a program at the federal level may have some small administrative savings, but introduces agency costs that likely dwarf these savings. Massachusetts had little incentive to be efficient or to save money when doing the Big Dig, because the federal government was picking up the tab.
Government programs are cheaper and more efficient than most private firms.
Do you really believe this? I find this exceedingly implausible, for a number of reasons, but if you really believe that the government is more efficient at doing things than the private sector, why not just nationalize all major industries? Why not nationalize the car industry? The computer industry? The retail sales industry? The oil and gas industry? The banking industry? Etc. Why not bring the benefits of government efficiency to these businesses also?
The rule of law gets broken by the rule of "might makes right". Those breaking it can come from any sector (Microsoft, Standard Oil).
The Microsoft case is a classic example of how companies like Sun, who had lost fair and square in the marketplace due to the inferiority of their products (Sparc/Solaris computers were expensive and slow compared to x86/Windows or x86/Linux systems), used the legal system and the antitrust laws to extort money away from a more successful competitor. The result did not benefit anyone, least of all consumers.
Tax policy is used in many cases to influence public behavior, not as a source of revenue (cigarette taxes). Whether this is philosophically "pure" or not is an open question. It is easier for politicians to pass a new tax then to pass a law regulating behavior. Is this cheating? Yes. Is it practical? Yes. Is it overused? Sometimes.
The tax system *is* used that way -- that's just a fact -- but it's not a good idea. High tax rates cause problems of their own, such as increased rates of tax evasion. In general, the higher tax rates are, the more harm they cause to the economy (the greater the "deadweight loss"). We are better off with a tax system with low rates and fewer deductions than a system with high rates and many deductions. For example, we would do well to abolish the deductions on home mortgage interest, state and local taxes, and employer-provided health insurance, and counterbalance this with a drop in tax rates and an increase in the standard deduction.
The problem with philosophies of government is that they fail in the real world where pressures are applied. That is why an alert population which has democratic power is the best way to correct things when they go wrong.
Partially agree with the first sentence, but disagree with the second sentence. Democracy is a *terrible* way to make many types of important decisions.
To take a completely non-political example, I would not want software engineering decisions on the projects I work on to be decided based on a vote of all the engineers, with each engineer getting one vote. Instead, I would much prefer that the most competent engineers be given absolute authority to overrule the decisions of the other engineers -- a meritocracy, not a democracy. When it comes to opinions about how to implement something, there are some people I trust greatly to do the right thing most all of the time, and there are other people whose opinions I give zero or sometimes even negative weight.
Some people's opinions are simply *wrong* and are therefore useless to decision-making. Democracy takes no account of whether an opinion is right or wrong -- it simply adds up the number of people who believe it, and declares the belief with the largest number of supporters to be the winner, whether it is true or false.
Take the Ballistic Missile Defense. It is an utter waste.
I am not by any means an expert on this particular program, but I am very amenable to killing it.
Not with you here. The rule of law should be equally applied but the law itself may fall more heavily on some. For example a progressive tax code should be applied to all (everyone pays taxes) but due to the structure of the code it will require the wealthy to pay more. Just as a law against murder will affect murderers more than non-murderers.
Well, sure, in some sense, a law against murder is picking a winner in the contest between murderers and non-murderers. In that case I'm *fairly* certain the law has picked the correct winner. :)
What I'm concerned about is picking winners in terms of economic matters. The law should not favor renters over homeowners, or vice versa. It should not favor urban areas over suburban areas or rural areas, or vice versa. It should not favor farming over manufacturing or service industries, or vice versa. It should not favor vertically integrated companies over horizontally integrated companies or non-integrated companies, or vice versa. It should not favor companies that pay dividends over companies that reinvest profits, or vice versa. It should not favor Windows over Linux, or vice versa. It should not favor packet-switched networks over circuit-switched networks, or vice versa. It should not favor cars with automatic transmissions over manual transmissions, or vice versa. Etc. The winners in these sorts of economic matters should be decided in the marketplace, not by government decree.
That is, the government should set the rules of the system... and then it should step back and watch. If someone breaks the rules of the system, it should intervene, but otherwise, it should let the system do what it will. Sometimes the rules of the system have to be tweaked a little bit here and there, but never retroactively.
If the rules of the system are designed properly and are executed faithfully, the *results* of the system must be allowed to stand. You cannot go back and ask for a do-over because you didn't like the results. If the rules of the system result in Bill Gates becoming a bazillionaire, so be it -- the result is what it is.
The private sector has a horrible record of dealing with problems. [...] Think about all the big advances. All of them have come from either academia (which of course is government supported) or the government itself. [...] The private sector is by and large much worse than government in terms of using resources efficiently.
On one hand I'd ask the same question as I did in reply to rdf's post: if you believe this, then why not have the government nationalize *all* major industries?
On the other hand, I'd fundamentally dispute the claim that the private sector is less efficient.
First off, I just look at the industry I work in: the computer hardware industry, specifically the semiconductor industry. Every year, competition compels my employer to spend hundreds of millions of dollars in R&D to produce better products. The result is that each year, we ship new chips that are better in every regard than the previous year's chips. They are faster, cheaper, consume less power, and have more features. On average, we deliver products that are about 30-50% better in terms of price/performance each year than we did the previous year.
If we failed to do this in any particular year, we'd quickly find ourselves unprofitable. If we failed to do this two years in a row, we'd find ourselves essentially bankrupt.
People look at the incredible advances in computers and think it was all inevitable. It wasn't. Many billions of dollars of R&D have been put in behind the scenes to make today's computers possible. For example, in 1999, we built chips using 0.35-micron technology -- a transistor had dimensions of 0.35 microns. Now we are building chips using 65nm (0.065-micron) technology, and before long we will be using 45nm (0.045-micron) technology. This allows us to pack more transistors into less space on the silicon, and those smaller transistors also run faster and use less power.
It would be very wrong to think that all you have to do to go from 0.35-micron chips to 45nm chips is to crank up the "zoom lens" in the factory. After all, if it was that easy, people would have been building 45nm chips back in 1999! There are extremely challenging technical problems that had to be solved to reliably and cost-effectively manufacture millions of chips at these tiny geometries. Companies like Intel and Applied Materials and IBM have spent billions of dollars trying to stretch these things to the limits of what physics allows.
Each year the problems get harder and harder. Designing a 10M transistor chip that works correctly is difficult. Designing a 100M transistor chip is harder. Designing a 1B transistor chip is even harder. The costs of designing/developing these products keep going up exponentially each year -- and yet somehow we have to sell them for *less* money each year! So, every year, we have to get smarter about how we do things. Each year we have to come up with new tricks on how to do things that are more effective than old techniques. Academia is of no help here -- we are doing stuff that is easily 10 years beyond what people in academia are up to.
I look at my industry and I do not see inefficiency. I see a constant, endless treadmill where competition forces us to *increase* our efficiency every single year. There is no rest. This year we ran a 6-minute mile... well, next year, we'd better run a 5-minute mile, and the next year a 4-minute mile, and the next year a 3-minute mile, and the next year a 2:30 mile, and so on. We literally have no choice but to keep building better and cheaper products, or to go out of business.
Second, every now and then I see claims from various people like "the private sector is less efficient than government, because of [CEO salaries, profit margins, advertising, wasteful competition, duplication of administrative burden across companies, etc.] If only the government could just sweep away all that waste..." This argument is superficially appealing, but suffers from many fundamental flaws.
Here's one key reason. Corporate accounting is primarily done on a GAAP basis, using accrual accounting. Government accounting is primarily done on a non-GAAP cash-flow basis. To directly compare the books of a government agency with those of a corporation is to compare apples to oranges.
For example, when a corporation wants to build a factory, it has to obtain the capital from somewhere (debt or equity financing). The factory gets written up as an asset, the debt gets written up as a liability, and the equity gets written up as equity. The factory asset is then written off as depreciation over its lifetime as a useful asset. The interest on the debt shows up as an expense on the income statement, while the earnings from the factory sales show up as a profit.
If the corporation uses purely equity financing, its balance sheet will show a GAAP profit much higher than if it uses purely debt financing, because GAAP does not require you to charge yourself a "cost of capital" on your equity -- even though equity financing is hardly free. Generating profits and returning them to your shareholders *IS* the cost of equity financing!
To look at a GAAP corporate balance sheet and see a profit and therefore conclude that the corporation is overcharging its customers is faulty reasoning. In fact, if you want to determine the *economic* profit being earned by a corporation, you really need to look at other factors like the corporation's return on equity. For example, if a corporation is earning a 5% return on equity, it is actually incurring economic *losses* -- its profits are too small compared to the capital it is consuming. Further, you must adjust the return on equity to take into account the risk that the corporation is incurring, and to account for various cyclical factors.
The health insurance industry has a return on equity of approximately 12.2%. (http://biz.yahoo.com... ) This is not terribly out of line with the rest of the economy, and indicates to me that health insurance companies are in fact earning very little in the way of economic profits on average.
When the government publishes its budget numbers, it is *not* generally using GAAP. It is using cash flow accounting: cash receipts and cash outlays. This is a badly flawed way of doing accounting as soon as capital expenditures enter the picture. It doesn't properly account for things like accounts receivable and payable, inventory, depreciation, cost of capital, and so on.
An insurance company that ran its books the way Social Security or Medicare do would find itself very quickly facing a lawsuit. For example, in accrual accounting, when you receive insurance premiums, you cannot just write them up as a profit immediately. You have to write up a corresponding estimated liability for the fact that down the road, you are probably going to have to *pay out* some money too.
I would propose completely eliminating all the following federal programs -- just a random smattering for starters, and hardly a complete list.
- Hybrid vehicle tax credits
- Farm subsidies
- Amtrak subsidies
- Space shuttle
- Privatize air traffic control system
- CAFE fuel economy standards
- Advanced Technology Program
- Small Business Administration
- Partnership for a New Generation of Vehicles
- Corporation for Public Broadcasting
- National Endowment for the Arts
I would also propose devolving the vast majority of the functions of the Departments of Education, Health and Human Services, Housing and Urban Development, and Interior to the states.
Running these programs at the state level allows states to experiment with different policies so we can see what works and what doesn't. It allows different parts of the country to better tailor the programs for their particular regional needs. It forces states to compete with each other to offer the best services at the lowest level of taxes. And it allows for better citizen oversight of government, because it's easier for you to personally influence (or even be elected or appointed to!) your city government than your county government; your county government than your state government; and your state government than the federal government.
Libertarians don't like social insurance because of the mistaken belief that they are smarter/better/luckier than the rest and thus will not need them in the future.
False. I'm not a libertarian, but there are several reasons I dislike these programs that have nothing to do with this. Let's pick Social Security.
My first big problem with Social Security is that it's an intergenerational scam where my generation is getting ripped off compared to people born in earlier years. Each generation of successive people going through the system is getting a worse deal than the previous generation, because the system originally had the levels of taxes and benefits set at unsustainable levels, and because the first generation of SS recipients never had to pay *anything* into the system. Current SS recipients are getting a great deal. Future SS recipients are going to get a very raw deal to make up for this.
My second big problem with Social Security is that it's one size fits all. SS offers one particular package of retirement benefits, survivorship benefits, and disability benefits. Don't like that package? Too bad. For example, there's no provision that allows you to say "I don't think I need the retirement benefits so much, but I really should sign up for *more* disability benefits."
My third big problem with Social Security is that the benefits you are promised are not legally binding. Congress is free to cut them at any time if they become too much of a strain on the federal budget. Therefore, the benefits are not really guaranteed in any true sense. Some "security!" Congress should make Social Security benefits, once earned, legally binding obligations of the Treasury. That way, the *only* way your benefits could be lost is if the US government were to default on its debt.
You failed to respond last time [...]
Oh, please... it's unreasonable to expect me to reply to every single comment in every single post.
The Microsoft case is a classic example of how companies like Sun, who had lost fair and square in the marketplace due to the inferiority of their products (Sparc/Solaris computers were expensive and slow compared to x86/Windows or x86/Linux systems), used the legal system and the antitrust laws to extort money away from a more successful competitor. The result did not benefit anyone, least of all consumers.
What do you think of the SCO lawsuits?
Democracy takes no account of whether an opinion is right or wrong -- it simply adds up the number of people who believe it, and declares the belief with the largest number of supporters to be the winner, whether it is true or false.
Pretty sure I remember liberals griping along those lines in 2004! While you're right, there's just no way a meritocracy could work in practice. Like communism, it depends on people being "noble" and perhaps acting against their self-interest. Personally I think my vote should count for at least 10, since I'm so well-informed and all, but I imagine others might disagree with my preferrred weighing.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
Some problems are fundamental to human existence and are altogether impervious to being "solved."
This type of statement always makes me testy. Does being "impervious to being 'solved'" mean that the government should quit trying to alleviate?
Take poverty, for example. As long as there are human beings on this earth, there will be poverty. Not all people will rise to the top of the economic ladder, nor even to the middle.
Do we let the poor just starve there in their huddled masses because we'll never end poverty?
Just because there is a condition that are fundamental to human nature doesn't mean that the government shouldn't take steps to try to fix it. If we never strive to fix "impervious" problems, we will never make any difference.
Yeah, you're right about some conditions being impervious to being fixed. They'll stay that way unless we work to change that paradigm.
It should not favor vertically integrated companies over horizontally integrated companies or non-integrated companies, or vice versa. It should not favor companies that pay dividends over companies that reinvest profits, or vice versa.
Vertically and especially horizontally integrated companies, used to be illegal. There was a good reason for this, it is cheating in the case of the vertical monopoly, and tyranny in the case of the horizontal monopoly.
Talk of efficiency is cover for the real point of increased power. To understand what increased size does for efficiency think 10 acre hamburger joint. To understand what size does for power think McDonald's or better Mal-wart.
Likewise taxes and Government oversight had a salutary effect on how Corporations were run. The tax structure meant that plant and infrastructure reinvestment, particularly when was only in U.S. was encouraged, and ripoff and run was heavily taxed at best and possibly a prison term as well.
With the change in Tax structure, the Middle classes got socked with the highest taxes (since it included FICA)and far from encouraging reinvestment, the American landscape is littered with the empty husks of perfectly good companies, sucked dry and the money taken elsewhere.
Your argument that the Computer chip industry is competitive belies the fact that consumer electronics (still a very young industry)is still one of the few actual free enterprises (commodity markets)left, though for how long is a big question mark. As soon as one company (or a couple working together)is able to force all the others out of business, such advancements will come to a crawl if not a screeching halt. Prices will also rise as there would now be little to restrain them. That is already happening in parts of the industry.
An insurance company that ran its books the way Social Security or Medicare do would find itself very quickly facing a lawsuit. For example, in accrual accounting, when you receive insurance premiums, you cannot just write them up as a profit immediately. You have to write up a corresponding estimated liability for the fact that down the road, you are probably going to have to *pay out* some money too.
They do worse, the Congress has taken the SS funds for other programs leaving an IOU that Republicans want to burn so they don't have to actually pay it. That is bad enough.
The Insurance companies play fast and loose with their "estimated liability", write off most of the looting by management as a "business expense", and when the bill comes due they either dodge it ("you were insured against a Hurricane, but your house got wet and we don't cover floods"), or if the looting has been big enough, they just go bankrupt and leave everyone, investors and customers in the lurch.
Oh and "Tort Reform" means you can't reasonably sue them anymore either.
The Self Made Man is just not admitting where he got all the parts.
The reason why government shouldn't run all businesses is because government is not a good mechanism for entrepreneurship. The best model we have for fostering innovation is that of people being able to form new enterprises based upon their own ideas. Central planning cannot take into account all the ways people can be creative. That's why centralized economies (like the USSR) lagged behind in innovation.
It is also one of the reasons that monopolies don't innovate. Their dependence on easy profits squelches innovation within the firm and also prevents meaningful competition from forming. Notice that when AT&T was broken up it was rapidly followed by a huge growth in the number and types of communication services developed.
Big business is perfectly willing to gut essential services (the railroads come to mind) and then the government is forced to take them over.
Point two:
The end of your remarks above show your fundamental distrust of democracy. This is in perfect keeping with the RWA personality type (that's you whether you acknowledge it or not). The problem with having an elite decide things is:
1. They don't necessarily know what is best (some problems have no clear best solution).
2. They are not subject to the corrective actions of the "market place", that is the general public.
3. Who becomes the elite is based upon arbitrary criteria (like being born into a wealthy or influential family).
4. Decisions made without the agreement of the majority are not likely to be acted upon with sufficient enthusiasm. Slaves don't make good workers.
I'm sorry you don't approve of our (imperfect) form of government, but democracy is the best we've come up with so far. If you feel so superior to the rest of the population maybe you should move to one of the fine countries that embodies your ideals - Zimbabwe, Kazakhstan or perhaps China . If you are fortunate to be one of the elite you will have a comfortable life, on the other hand if you cross the leaders in some unknowable way you may find your options someone limited.
PS. Without opening the entire debate again about Microsoft, you really need to read up on the evidence that came out of the various trials. The number of illegal things that they did to become a monopoly might interest you. Just today there are stories about PC makers being gouged over the licensing conditions for the new Vista OS.
Yes, I would consider NASA generally an ineffective use of tax dollars. No, many of those missions would *not* have been funded elsewhere -- because many of them are a waste. Was it really worth $650M in taxpayer dollars to send a space probe to Pluto? In my opinion, no.
I did not follow them closely enough to judge the technological merit of what SCO was claiming.
While you're right, there's just no way a meritocracy could work in practice. Like communism, it depends on people being "noble" and perhaps acting against their self-interest. Personally I think my vote should count for at least 10, since I'm so well-informed and all, but I imagine others might disagree with my preferrred weighing.
My point is *not* that we should change our voting system in America to give different people different numbers of votes (although I *am* quite partial to my boss's proposal that you should get one vote per dollar in taxes that you pay -- not that it would ever actually happen).
My point is that other systems, like the market, are usually better ways of making many classes of important decisions than democracy. Democracy is a particularly bad way of making decisions about how best to allocate scarce resources.
The reason why government shouldn't run all businesses is because government is not a good mechanism for entrepreneurship.
So why, then, do you think that government *should* run at least certain portions of the health care and insurance industries? Are you not therefore squelching enterpreneurship in those industries also?
Without opening the entire debate again about Microsoft, you really need to read up on the evidence that came out of the various trials.
Actually, I followed the Microsoft trials in great detail -- they were of great personal interest to me, seeing as they directly relate to my field of employment. I stand by my remarks. I consider Microsoft the victim of unjust persecution.
On to the important point:
The problem with having an elite decide things is:
This is a straw man. I don't advocate that all decisions should be made by some sort of "elite." I advocate that decisions about how to allocate scarce resources should be made primarily through the market process, not through a democratic process.
For example, there should *not* be a committee of "smart people" somewhere that decides, for each parcel of land in America, who should be allowed to use it this year and for what.
We should *not* have a vote in my county where leading real estate developers get to offer plans for how they plan to develop a piece of land, and the citizens of the county decide which plan wins by casting one vote each.
Instead, land should be privately owned, and if you want to buy it, you should have to make an offer to its current owner that the current owner is willing to accept. Once you own it, it is up to you to decide what to do with it.
There are compelling reasons to believe democracy is a mediocre way of making many types of important decisions. Let me just touch on a few.
1. Kenneth Arrow's voting theorem (http://en.wikipedia.... ). Arrow proved that it is impossible to design a "fair" voting scheme when there are three or more options on the ballot. All such voting schemes must inevitably suffer from important flaws.
2. The classic arguments made in The Federalist Papers by James M
Comments :
Two fun scenarios
1. The Restaurant
Suppose you go to a restaurant by yourself and can order either the grilled chicken sandwich ($10) or the filet mignon and king crab ($40). Which do you pick?
Now suppose you go with a friend, having agreed in advance to split the bill evenly. Does your answer change? If so, why? Suppose it's a stranger and not a friend. Does your answer change? If so, why?
Now suppose you go with a group of 30 people, having agreed in advance to split the bill evenly. Does your answer change? If so, why?
2. Bridge to Nowhere
Suppose the 600,000 people of Alaska want to build a $300M bridge to nowhere. It will cost them $500 each to build it, but it's a pretty useless bridge, so that ain't gonna happen. They're not stupid, after all.
Now suppose they convince our good friend Congressman Don Young to slip an earmark into a federal spending bill. Now it costs each of 300M Americans $1 each. The bridge is still pretty useless, but, you know, if I'm an Alaskan, it only costs me $1, and I get a whole bridge out of the deal... this isn't sounding so bad.
If I'm a Californian, this sounds like quite a ripoff to me, but it's only $1. How much time and effort am I going to spend fighting something that only costs me $1?
We agree
on 99% of both the specifics and underlying philosophy.
The rub comes in, as I see it, is getting legislators and voters to understand these things on an intellectual level instead of on an emotional level. When issues such as cutting government functions come up, people tend to wonder how badly they'll be screwed by the change, or react emotionally in some variation of "but that's not fair to ____".
Perhaps the real issue is trust. I don't know if I personally have the level of trust in my elected officials to believe that they will stick with what's right and smart versus bowing to bigger ($$$) interests than me, nor that they'll ensure that the people's interests are served in whatever they do, especially if something goes wrong post-implementation.
I've been involved in lots of outsourcing in Corporate America. Usually, it sounds effective on paper -- cheaper, better, faster, less hassle -- but the reality always turns out differently. It usually ends up with less service at a higher price; sometimes it turns out so badly the entire project has to be yanked back. The sales pitch never turns out to match reality. Thus my hesitance to accept the "advantages" of privatization of key government services.
"Perplexity is the beginning of knowledge" -- Kahlil Gibran
Given all that...
The past six years of Bush administration stewardship with a Republican-controlled Congress must have been brutal for you.
If you really believe this is the "fight of our lives," how come you're not in Iraq?
I understand what small gov. means
to you in an economic sense (which I happen to agree and disagree with at various points, but I'll try to get to that later), but you skip over one of RDF's main points: how does your theory of small government reconcile 'social conservatism'?
He argues that conservatives want gov. to stay out of the way of business and economic concerns (which is nearly what you say in your diary), but you have no problem with it meddling in our social lives: abortion, religion in the public square, prohibition of homosexual marriage and drugs, and so forth.
Why does smaller gov mean only economics while diregarding its overreaching in other areas?
This question is very pertinent to you since you claim not to be a libertarian, but a conservative through and through.
Well put, but here's the thing
For whatever reason, it seems that often when Republicans start talking about small government and fiscal responsibility and balancing the budget, they're gunning for some social service program to which they are ideologically opposed. Nevermind that the government is usually doing a pretty efficient job of running that program (for example, food stamps runs less than 5% net waste
). On the other hand, rampant waste in reconstruction spending is ignored or actively enabled 
.
So, it's not that liberals have a problem with discussing which government programs are efficient, or which ought to be handled at a lower level or privatized. It's just that we tend to be suspicious when Republicans, who have shown little to no restraint when it comes to spending in general, suddenly decide to be responsible stewards of taxpayers' money; experience has taught us that this is usually a convenient way to coverup their attack on a program they don't like. I think that genuine fiscal conservatives need to do more than cheer these ideologically motivated cuts and keep demanding Republicans make real attempts to cut significant spending and waste.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
Family vs Corporate Farms
You say:
But the facts look a little different.
From Califronia Farm Bureau Federation's
latest study in 2000:
Hmm, percentage wise in output they are suffering, but they still consist of the majority of farms. So far I'm not convinced that we should hurt these already struggling farmers further.
More from a 2000 study on Alabama's farming (which also shows statistics regarding US family owned farms):
The study also says the owner structure changed little from 1992 to 1997, so I would assume corporations did not wipe out family farms in the last 9 years.
Where are you getting your claim about corporations owning most farms from? I think this is a clever way of using the left's distrust of corporations to actually help corporations by stripping away the last vestige of help for family farmers.
Link for
the Alabama study is http://www.ag.auburn...
Cost Benefit analysis....
The only issue I have with that statement is who sets the value of the benefit?
How much is a vibrant sustainable planet worth these days? Are they on sale at WalMart?
That alone points to every single environmental fight facing us. Let's use the Oil Industry as a further example. I postulate that if the Oil Industry spent more of it's money drilling in a safer and more ecologically friendly manner, there wouldn't be all that much opposition to drilling off our coasts (even here in CA) or in pristine places such as Alaska. Unfortunately for the Oil Industries side, they have a long track record of trying to extract maximum profits by skimping every place they can. Look at the Alaska Pipeline failures this year. BP hadn't sent a cleaner through their pipes, nor inspected them in OVER A DECADE. And this comming in on 6 years of ever increasing profits in that sector. They've shown us they can't be trusted with our sweet spots.
Can industry change and start practicing more environmentally friendly extraction & production techniques. Of course they can. You just have to convince the accountants and the idiots on Wall Street.
How much is 5 more years of your life worth? How about 10?
More on family farms
From United States Department of Agriculture 2001-2002 Ag. Factbook
I think you fall under the category of 'contrary to popular belief'.
Great point
It reminds me of this BBC article
which said:
I think it comes down to a question of values and who gets to set them. Short term benefits or long term benefits must be taken into consideration also.
Possibly you two are discussing different things?
Most farming is done by large agricultural corporations.
This statement would seem to be supported by your evidence, if 5000/74000 farms in CA account for 75% of all market value of agricultural products sold. That's not the same thing as saying corporations own most farms. Corporations own bigger farms. Agribusiness and all that.
Leaving aside the discussion of whether we should subsidize farming, there's no practical reason we couldn't target aid towards small family-owned farms.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
I try to address that point
with this statement from the California study:
I agree that perhaps we could implement a progressive tax on corporate farms/larger family farms or regressive subsidy on smaller family farms. If 62,000 farms are the majority of farms, but producing only 10% of output while 5,000 produce 75% of output, these smaller farmers are the ones that deserve the help.
Anyway, I think his phrasing was intentionally ambiguous to lead to his desired conclusion, and it is clear that the family farm (or even small family farm) is not dead.
Reply
1. Cost/benefit. This only makes sense if you can accurately define what the benefit is. For example government programs like the CCC and WPA during the depression put lots of people to work, some of them doing "non-productive" work like painting murals or putting on plays. The goals were only indirectly economic. Yes they got a salary, but they also got a sense of purpose and their pride back. Cost/benefit implies that the only measure of success is that used by private industry - profit.
2. Level of government. Most government programs are run at the appropriate level. Those that are too big get bumped up. If you resent government setting national standards (say for education) then that is a philosophical issue, not a practical one. We have seen many cases where letting local governments do things produces undesirable effect (Jim Crow).
3. I spent my entire working career (as did my wife) working for non-profits. I think they can provide a useful bridge between government and private business. Unfortunately over the past several decades many of them have been converted to for-profit firms (Blue Cross) and the results have not been for the best (40% increase in premiums). A result of "cost/benefit". The cost goes to the people, the benefit to the new owners.
4. Government programs are cheaper and more efficient than most private firms. Government salaries are a fraction of those in the private sector. That there may be some abuses doesn't change the general picture.
5. The rule of law gets broken by the rule of "might makes right". Those breaking it can come from any sector (Microsoft, Standard Oil).
6. Tax policy is used in many cases to influence public behavior, not as a source of revenue (cigarette taxes). Whether this is philosophically "pure" or not is an open question. It is easier for politicians to pass a new tax then to pass a law regulating behavior. Is this cheating? Yes. Is it practical? Yes. Is it overused? Sometimes.
The problem with philosophies of government is that they fail in the real world where pressures are applied. That is why an alert population which has democratic power is the best way to correct things when they go wrong.
I appreciate your attempt to formalize your position. But you need to realize the world is imperfect and that what may seem like a good ideal needs to be compromised by what can actually be done.
--- Policies not Politics
agreement and disagreement
Agreed, no issue here. I find though that, practically, even small goverment conservatives tend to weight things based on emotion rather than numbers. Take the Ballistic Missile Defense. It is an utter waste. With over 100 billion dollars (and another 10billion a year average) and two decades of work the thing can hit a known target with a track device on board maybe one out of three times. It is a total waste. Even if it worked as designed the russians already have a missile that would defeat it.
And yet where are the conservatives calling for it to be scrapped? I haven't seen any and I'd welcome them with very open arms.
Agreed again.
Agreed if we changed "many problems" to "A very few problems..." The private sector has a horrible record of dealing with problems. They have been terrible in the energy sector (think Enron). Terrible in the prison sector (think Wackenhut). Terrible in the military sector (think Halliburton). In fact I'm hard pressed to think of a single problem that the private sector has tackled and not completely screwed up.
Think about all the big advances. All of them have come from either academia (which of course is government supported) or the government itself. Internet? Government. Space program? Government. MRI? Academia. And so on...
Where are these problems the private sector has handled?
Total agreement. In fact I mentioned before that I support writing a constitutional amendment to require the government to run a balanced budget except in times of declared war or national emergency.
Not with you here. The rule of law should be equally applied but the law itself may fall more heavily on some. For example a progressive tax code should be applied to all (everyone pays taxes) but due to the structure of the code it will require the wealthy to pay more. Just as a law against murder will affect murderers more than non-murderers.
I don't necessarily agree. Your position here seems predicated on the idea that the private sector works better than government but as above that simply isn't true. The private sector is by and large much worse than government in terms of using resources efficiently. Health care is a perfect example of this. We spend way more on medicine than those countries that have socialized health care and get less in return for the cost. All because we are paying for countless redundant company programs rather than a single centralized system with one administration.
Here is how I would rewrite this bullet: Taxes are necessary to fund government, but they have to be justified in terms of what value a citizen gets in return.
This then becomes the counterpoint of bullet number 1: government needs to have cost efficient programs and these programs need to give a return to the citizens commensurate with what they cost the citizen.
I came. I saw. I posted.
Veni, Vidi, Bitchy.
I don't think anyone
would argue about reducing pork barrel projects. Good riddance.
It is when you try to use this analogy to other social programs (education, medicare, etc) that it is no longer 'filet mignon and king crab'. Maybe a more apt analogy for the social programs most liberals/democrats concern themselves with would be pork and beans and a slice of bread.
Look at conservative commentators over the last 6 years??
Yes, economic conservatives *have* been quite pissed off. The only question was what to do about it -- whether to vote "in protest" for D's or whether to vote "for the lesser of two evils" for R's.
LZ likes the Value Added Tax.
VAT's are almost National Sales Tax except on everything.
My GOD! Here we have a conservative who is calling for A BRAND NEW TAX to be paid by EVERYONE! what? The poor would pay more with a VAT? Well, why didn't you say so?
Fusionism
The classical alliance between conservatives and libertarians dating back to circa Barry Goldwater, "fusionism", attempts to answer this question.
Liberals may not realize that social conservatives are split on the issue of federalism. Many social conservatives would prefer *NOT* to pass the Federal Marriage Amendment -- they really *don't* want to "tamper with the Constitution" if they don't have to. But they also fear that liberal judges will "discover" a right to gay marriage hidden in the Constitution, just as previous judges "discovered" a right to abortion and a right to sodomy.
Yes, they want prayer in schools, but few want prayer in schools *imposed* by the federal government. Their greater fear is that government-run schools will *stamp out* existing expressions of religion that have been common in schools for hundreds of years -- that's one of their main motivations behind supporting homeschooling and school vouchers.
Fusionism means that the "libertarian" and "social conservative" wings got together and said: we *both* can agree on the points such as the following.
- Federal involvement in things like welfare and education is bad.
- Liberal judges' decisions like Roe v. Wade are bad -- this issue should have been left to the states.
- Taxes are too high and are stretching families' budgets and hurting the economy.
Fusionism falls apart if social conservatives insist on federal involvement in the Terri Schiavo case, or if libertarians insist that we should pass a constitutional amendment that *does* guarantee a right to abortion. Otherwise, social conservatives and libertarians really *ought* to be able to get along with each other.
Now, am I a "libertarian?" Depends on the definition of the term, but I *do* support at least some "social conservative" positions. I oppose gay marriage *and* civil unions, for example, and find the Federal Marriage Amendment distasteful but yet worry that it is necessary. I don't think the Constitution guarantees a right to abortion or sodomy. I don't think we need to remove the word "God" from the Pledge of Allegiance or our currency. I disagree with those who want to outlaw abortion, but also respect them for taking what I consider a valid point of view on the topic.
Where I depart from social conservatives is when they try to stick the federal government into things like the Terri Schiavo case or talk about passing laws that curtail the jurisdiction of federal judges. But I also depart from libertarians on the Patriot Act and many other civil liberties issues.
Difference is...
...conservatives *don't* consider those social programs to fall into that category. They think some of those programs cause more harm than good, and that many of the others are ineffective at best based on the amount of money we are spending on them.
Examples
Please provide examples for this quote:
Exactly which programs are causing harm? Which are ineffective (I assume you mean inefficient)? Libertarians don't like social insurance because of the mistaken belief that they are smarter/better/luckier than the rest and thus will not need them in the future. Not believing in shared risks is one of the ugliest aspects of the "everyman for himself" mindset behind libertarian thought.
Reagan's theme about welfare moms driving in Cadillacs was false. Similar claims about people using food stamps to buy drugs have not been true or have represented a very small number of cases. Head start is a success. It is the later years of schooling (provided by local funds) where these kids fall behind.
You failed to respond last time to my list of social programs which were all performing well and supported by the majority of the public.
There is also no evidence that local government performs better than the national. Dislike of the federal government seems to be a visceral response based upon nothing tangible.
--- Policies not Politics
Then everyone is for small government
In this case, I don't think there is ANY government need to control the relative sexes between a married couple. So I'm willing to accept the "necessary evil" of a State or Federal Court from noting that the government has no place in that decision just as you are willing to accept the necessary evil of Constitutional Amendment to in order to grant the states the power to ignore equal protection requirements.
We both see our view as the 'status quo' and need just a little bit of government power to protect us. And be careful about dissing "discovered" rights, unless you are willing to defend miscegenation laws as within the right of the states.
I have a few very conservative friends...
... who just couold not bring themselves to vote for Bush in `04.
Not saying they voted for Kerry, but they didn't vote for Bush, either.
If you really believe this is the "fight of our lives," how come you're not in Iraq?
Republicans vs. conservatives
I think you are falling for the classic mistake of mixing up "Republicans" and "conservatives."
We conservatives *ARE* doing that.
Conservative Republicans *did* make a very serious attempt to do that this last year, in the form of the RSC substitute budget:
http://www.house.gov...
http://www.house.gov...
Boehner allowed the RSC budget to come up for a vote. It failed 94-331, with all 94 "yes" votes coming from Republicans. Here was the tally: http://clerk.house.g...
I think it would be safe to say that any Republican who opposed the RSC budget is *not* a committed "small government conservative." And indeed, I gave money to a conservative candidate (Tim Walberg) who successfully unseated one of these liberal Republicans (Joe Schwarz) in a primary and then won in the general election on Tuesday. I've donated to numerous other conservative candidates in the last -- some who won (e.g. Tom Coburn), some who lost (e.g. Pat Toomey). I am doing my part! I have been putting my money whether my mouth is. I have been doing what I can to force my party to move rightward on economic issues.
The conservatives I follow were all strong supporters of the RSC's effort to pass this alternative budget and of the RSC's previous efforts, such as their earlier "Operation Offset" to balance Katrina reconstruction spending with other cuts elsewhere. They were also strong supporters of Jeff Flake's 19 anti-Pork amendments and Tom Coburn's anti-Bridge-to-Nowhere amendment.
Some may laugh at these efforts as irrelevant, but Operation Offset was the direct antecedent to the 2005 Deficit Reduction Act, the first mandatory spending cut bill to pass Congress in some years. If it hadn't been for Operation Offset and the tireless efforts of Flake, Coburn, and others, the Deficit Reduction Act would never have happened.
And now, Mike Pence, chair of the RSC, and John Shadegg, a very visible member of the RSC, are running for minority leader and minority whip, and have already picked up *very* strong support from conservatives.
* Both Mike Pence and John Shadegg voted for *ALL* 19 Jeff Flake anti-pork amendments.
* Both Mike Pence and John Shadegg voted *AGAINST* the Medicare prescription drug bill.
* Both Mike Pence and John Shadegg voted *AGAINST* No Child Left Behind.
* Both Mike Pence and John Shadegg voted *FOR* the RSC substitute budget.
You will not find many other folks in Congress who are on all four of those lists.
Unlike Hastert and Blunt and to a lesser extent Boehner, these guys are the real deal. Mike Pence has even referred to himself as a "Club for Growth experiment gone bad."
Fair enough
I don't think I was mixing up (fiscal) conservatives and Republicans, just suggesting that Republicans tended to get fiscal conservatives to sign on to their ideological cuts by selling them as spending cuts. I wasn't trying to denigrate the efforts of genuine fiscal conservatives -- it's nice to see them looking to regain influence in the Republican party. I hope Pence and Shadegg get those positions, I know they are highly thought of in the blogosphere anyway. And I'll be happy if my comment turns out to only apply to the past and is no longer relevant to the future.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
Alive vs. economically viable
In a minimal sense, there certainly *are* still family farms. But they are swimming against quite an upstream current. It is very hard to compete with the economies of scale of large agribusinesses. As one actual Wisconsin dairy farmer told me some years back, he's not in it for the money any more -- he's in it because it's what he loves to do. (His milk business had gone south, and his farm was being kept alive mostly because he had gotten into the breeding business -- selling his best milk-producing cows' DNA.)
As your link noted, the number of farms declined 0.7% nationwide from 1992 to 1997. Further, at least in Alabama, "the proportion of farm operators who considered farming as their major occupation declined." This is all *despite* continued farm subsidies.
Agricultural-sector employment fell from 2.9M to 2.1M between 1994 and 2004, and was expected to fall further to 1.9M by 2014 (http://www.bls.gov/n...
).
If farm subsidies were eliminated, how many of these family farms would be economically viable? I don't know for sure, but I suspect a large fraction would not be. Many farmowners would probably sell out.
I'm don't see why we should be helping farmers, *period*. Why are we using the power of government to confiscate money from urban and suburban dwellers (such as myself) to give it to rural farmowners? Why is their lifestyle so particularly deserving of our government's favoritism? This violates my principle (5) -- "picking winners and losers."
Or, put another way: why should the 99% of the US population that is *not* employed in the agriculture industry have its money forcibly confiscated from it in order to subsidize the <1% of the population that is? Is this not a classic example of a "special interest group" demanding unfair special government favoritism, contrary to the public interest?
If a farm is only being kept alive by farm subsidies, it is an economic failure. It *SHOULD* be allowed to fail, so that the capital tied up in the farm can be reused for other, more efficient purposes. If that means that the family farm finally *does* go away, so be it.
Straw man
Nowhere did I say anything like "the environment is worthless" or "the only benefits that count are monetary" or "we should sacrifice our long-term interests for short-term benefit." I, and the vast majority of small government conservatives, would in fact *disagree* with all three of these statements.
It may be tempting to throw the "you only care about money! what about *people*?" epithet at us, but it just ain't so. Small government conservatives are most certainly *not* out to ruin everyone's lives.
Indeed, it would be very hard to reconcile your statements about despoiling the environment and all with the fact that I support carbon and other environmental taxes (though with some caveats regarding how they are administered).
What about the waste and disappearing billions in Iraq?
Just asking...
If you really believe this is the "fight of our lives," how come you're not in Iraq?
Iraq War Spending
There seems to be a lot of wasting of taxpayer money w/ REgards to Iraq, haliburton, etc.
How do conservatives think we should handle it--Investigate them?
The other statistics from that same page...
http://www.usda.gov/...
Between non-family farms and "very large" family farms it looks like we have accounted for fully 50% of agricultural production. Add in "large" family farms and they quote the number at 68%.
Fully 40% of the *number* of farms are "residential" farms, those defined as "small farms whose operators report a major occupation other than farming." Another 15% are "retirement" farms. Less than 25% of farm production appears to come from "farming-occupation small family farms."
The trouble here is the confusion between what the average person thinks of when you think of a "family farm" vs. the modern reality. When someone says "family farm", it conjures up the image of a guy in Iowa whose family has lived on the same plot of land since 1880 and who gets up at 4 AM every morning with his teenage son to milk the cows.
That's not exactly how it is any more. A "very large family farm" may be *owned* by a family, but with sales of $500K a year or more, these are serious businesses.
That classic stereotype really only fits the "farming-occupation small family farms."
I mean, Koch Industries is a "family business"... owned by the Koch family. It also happens to have $90 billion in annual sales and 85000 employees (http://www.forbes.co...
).
Small govt
From your definition, I think Clinton was more conservative than Bush.
Uhhh... yes?
By no means am I in favor of exempting military spending as an area where we need to be watchful. In fact, if you look at the RSC budget, you will find that it makes several concrete proposals on how to cut the DoD budget. These cuts add up to about $17B over 5 years.
Conservatives have also cheered things like the elimination of the Crusader artillery system.
At the same time, we do have to remember that military spending is about 4% of GDP, while non-defense spending (excluding interest on the debt) is about 14.5% of GDP.
Great series of articles on farm subsidies
http://www.washingto...
Here is their investigative series: http://www.washingto...
From the lead article:
There's a reason I keep bringing up farm subsidies as an example -- they really are, as government programs go, about as close to a complete taxpayer scam as you're going to find.
LZ, sometimes you really confuse me
I usually take issue with something you say, and you take my response and stretch it to places I had no intention of going.
For example, I'm not a fan of (most) farm subsidies. I too think the majority of them are a form of corporate welfare. I think the original purpose was well intentioned, but for the most part that reason is now obsolete. I do think a fair transition to eliminating the program altogether would be first to implement a regressive subsidy for small family farmers. This would allow families who've worked the land for generations to compete. Perhaps a time line is also necessary that would phase them out altogether but would also allow the small family farms to gauge whether or not they should remain in that occupation without leaving them immediately homeless. Was this the main point (or even a substantial subpoint) of any of my responses? No.
What I did take issue with was your phrase stating that "the family farmer died years ago." Production? Admittedly, they are in the minority. The majority of farmers? Yes. So I thought your statement a little disingenuous. That was my main point. They are not dead as far as number of farmers are concerned. They are still considered the majority of farmers, but not the majority in farming. I think 'dead' then might be a stretch here. I'm not really in favor of farm subsidies, but I do think you should present your arguments a little more fairly and accurately.
Whose idea was farm subsidy
Dems or Repubs?
Re--Small govt
If in your small govt world I save $500 in taxes but end up paying $5000 for tolls, health care, school, property taxes, road taxes etc, i would rather give back the $500 tax cuts I save rather than spend more money.
Fair enough
I didn't get that out of your replies -- the impression I got was that you were defending farm subsidies on the grounds that there really are a lot of family farms out there.
Yes, "the family farmer died years ago" is a bit of an exaggeration -- mocking the absurdity I see in the arguments used to justify farm subsidies. I just find it extremely frustrating how many tax dollars I pay into the system, only for it to be frittered away on this sort of junk, with the arguments offered in favor of the spending so ridiculously flimsy. Government spending gets me seriously *angry*.
My approach to farm subsidies would be very simple -- slash them by 10% each year until after 10 years they're completely gone. No distinguishing between various classes of farmers. Just plain old "sink or swim."
Reply
No -- what it means is that we have to be *quantitative* about things, and that results are more important than intentions.
A simple example is to compare the effect of the following two policies:
- Increasing CAFE standards by 10 miles per gallon
- Raising the gas tax 50 cents per gallon and sending every American an annual rebate check using the proceeds
(feel free to tweak the numbers 10 and 50 a bit if you want; the exact numbers aren't what is important)
The former policy is ineffective/inefficient; the latter is effective/efficient. The proponents of the former policy may have good intentions, but those good intentions count for very little, because the policy they are promoting is clearly inferior to an alternative policy. (Without going into all the details, the fundamental flaw of the CAFE standards is that they only affect new cars; unlike gas taxes, they do not affect the incentives of existing car owners to get rid of their current cars sooner in favor of newer, more efficient cars. I would be happy to elaborate further in another thread.)
A proponent of a program may certainly claim that the benefits of the program are "a sense of purpose" or "pride." But how are we to weigh the value of these claimed benefits? Are we to merely take the proponents of the program at their word, regardless of how many taxpayer dollars they are asking us to appropriate?
No matter how great a program sounds in concept, there is a cost beyond which it just ain't worth it. I made this point in another thread in terms of saving lives. Is it worth $100K to save a life? Sure. Is it worth $10M? Maybe. Is it worth $1B? No, it isn't.
To make such decisions, we need to move beyond the qualitative into the realm of the quantitative. This is necessarily at least somewhat subjective, but not completely so. For example: is it worth (say) $1B to give 100 people a "sense of pride?" No, it isn't.
The CCC or WPA may well have given some people a sense of pride. The taxes required to finance these same programs may also have caused someone else to lose their job. FDR may have had "good intentions" in promoting programs like the CCC or the WPA, but when it comes down to the cold hard facts of the matter, it's not at all clear that these programs were wise uses of taxpayer dollars or a net benefit to the country.
You are welcome to claim that a policy offers benefits that are intangible in nature. Just be prepared to face skepticism from folks like me who question whether how real these intangible benefits are, and whether they're worth shelling out my cold hard cash for. I am, after all, the sort of "practical" person who drives about as boring a car as you can get: a Toyota Corolla. No, it isn't the "coolest" or "hippest" car out there, but is "coolness" or "hipness" worth my spending an extra $10K on a car? In my opinion, no. (I made the purchase based on tangible factors such as reliability, price, fuel efficiency, interior room, 4 doors vs. 2, etc. Coolness and hipness did not enter into my thinking.)
I find this fairly implausible. See my comment elsewhere in the thread on "The Restaurant." When you get to split the cost of something among a larger pool of people, you have an automatic incentive to be wasteful, and the *other* people have a reduced incentive to crack down on your waste. The filet mignon and king crab sounds steep at $40 instead of $10, but if there are 30 people splitting the check, it only costs you an extra $1 to splurge, so why not? And the other people only have to pay an extra $1 for your choice, so they aren't going to make that big a fuss over it. Compare to if it's just 2 people, where your friend might be pissed off at you that you made him shell out an extra $15 for *your* dinner.
(In game theory, "The Restaurant" is a classic "Prisoner's Dilemma" situation.)
Running a program at the federal level may have some small administrative savings, but introduces agency costs that likely dwarf these savings. Massachusetts had little incentive to be efficient or to save money when doing the Big Dig, because the federal government was picking up the tab.
Do you really believe this? I find this exceedingly implausible, for a number of reasons, but if you really believe that the government is more efficient at doing things than the private sector, why not just nationalize all major industries? Why not nationalize the car industry? The computer industry? The retail sales industry? The oil and gas industry? The banking industry? Etc. Why not bring the benefits of government efficiency to these businesses also?
The Microsoft case is a classic example of how companies like Sun, who had lost fair and square in the marketplace due to the inferiority of their products (Sparc/Solaris computers were expensive and slow compared to x86/Windows or x86/Linux systems), used the legal system and the antitrust laws to extort money away from a more successful competitor. The result did not benefit anyone, least of all consumers.
The tax system *is* used that way -- that's just a fact -- but it's not a good idea. High tax rates cause problems of their own, such as increased rates of tax evasion. In general, the higher tax rates are, the more harm they cause to the economy (the greater the "deadweight loss"). We are better off with a tax system with low rates and fewer deductions than a system with high rates and many deductions. For example, we would do well to abolish the deductions on home mortgage interest, state and local taxes, and employer-provided health insurance, and counterbalance this with a drop in tax rates and an increase in the standard deduction.
Partially agree with the first sentence, but disagree with the second sentence. Democracy is a *terrible* way to make many types of important decisions.
To take a completely non-political example, I would not want software engineering decisions on the projects I work on to be decided based on a vote of all the engineers, with each engineer getting one vote. Instead, I would much prefer that the most competent engineers be given absolute authority to overrule the decisions of the other engineers -- a meritocracy, not a democracy. When it comes to opinions about how to implement something, there are some people I trust greatly to do the right thing most all of the time, and there are other people whose opinions I give zero or sometimes even negative weight.
Some people's opinions are simply *wrong* and are therefore useless to decision-making. Democracy takes no account of whether an opinion is right or wrong -- it simply adds up the number of people who believe it, and declares the belief with the largest number of supporters to be the winner, whether it is true or false.
Reply
I am not by any means an expert on this particular program, but I am very amenable to killing it.
Well, sure, in some sense, a law against murder is picking a winner in the contest between murderers and non-murderers. In that case I'm *fairly* certain the law has picked the correct winner. :)
What I'm concerned about is picking winners in terms of economic matters. The law should not favor renters over homeowners, or vice versa. It should not favor urban areas over suburban areas or rural areas, or vice versa. It should not favor farming over manufacturing or service industries, or vice versa. It should not favor vertically integrated companies over horizontally integrated companies or non-integrated companies, or vice versa. It should not favor companies that pay dividends over companies that reinvest profits, or vice versa. It should not favor Windows over Linux, or vice versa. It should not favor packet-switched networks over circuit-switched networks, or vice versa. It should not favor cars with automatic transmissions over manual transmissions, or vice versa. Etc. The winners in these sorts of economic matters should be decided in the marketplace, not by government decree.
That is, the government should set the rules of the system... and then it should step back and watch. If someone breaks the rules of the system, it should intervene, but otherwise, it should let the system do what it will. Sometimes the rules of the system have to be tweaked a little bit here and there, but never retroactively.
If the rules of the system are designed properly and are executed faithfully, the *results* of the system must be allowed to stand. You cannot go back and ask for a do-over because you didn't like the results. If the rules of the system result in Bill Gates becoming a bazillionaire, so be it -- the result is what it is.
On one hand I'd ask the same question as I did in reply to rdf's post: if you believe this, then why not have the government nationalize *all* major industries?
On the other hand, I'd fundamentally dispute the claim that the private sector is less efficient.
First off, I just look at the industry I work in: the computer hardware industry, specifically the semiconductor industry. Every year, competition compels my employer to spend hundreds of millions of dollars in R&D to produce better products. The result is that each year, we ship new chips that are better in every regard than the previous year's chips. They are faster, cheaper, consume less power, and have more features. On average, we deliver products that are about 30-50% better in terms of price/performance each year than we did the previous year.
If we failed to do this in any particular year, we'd quickly find ourselves unprofitable. If we failed to do this two years in a row, we'd find ourselves essentially bankrupt.
People look at the incredible advances in computers and think it was all inevitable. It wasn't. Many billions of dollars of R&D have been put in behind the scenes to make today's computers possible. For example, in 1999, we built chips using 0.35-micron technology -- a transistor had dimensions of 0.35 microns. Now we are building chips using 65nm (0.065-micron) technology, and before long we will be using 45nm (0.045-micron) technology. This allows us to pack more transistors into less space on the silicon, and those smaller transistors also run faster and use less power.
It would be very wrong to think that all you have to do to go from 0.35-micron chips to 45nm chips is to crank up the "zoom lens" in the factory. After all, if it was that easy, people would have been building 45nm chips back in 1999! There are extremely challenging technical problems that had to be solved to reliably and cost-effectively manufacture millions of chips at these tiny geometries. Companies like Intel and Applied Materials and IBM have spent billions of dollars trying to stretch these things to the limits of what physics allows.
Each year the problems get harder and harder. Designing a 10M transistor chip that works correctly is difficult. Designing a 100M transistor chip is harder. Designing a 1B transistor chip is even harder. The costs of designing/developing these products keep going up exponentially each year -- and yet somehow we have to sell them for *less* money each year! So, every year, we have to get smarter about how we do things. Each year we have to come up with new tricks on how to do things that are more effective than old techniques. Academia is of no help here -- we are doing stuff that is easily 10 years beyond what people in academia are up to.
I look at my industry and I do not see inefficiency. I see a constant, endless treadmill where competition forces us to *increase* our efficiency every single year. There is no rest. This year we ran a 6-minute mile... well, next year, we'd better run a 5-minute mile, and the next year a 4-minute mile, and the next year a 3-minute mile, and the next year a 2:30 mile, and so on. We literally have no choice but to keep building better and cheaper products, or to go out of business.
Second, every now and then I see claims from various people like "the private sector is less efficient than government, because of [CEO salaries, profit margins, advertising, wasteful competition, duplication of administrative burden across companies, etc.] If only the government could just sweep away all that waste..." This argument is superficially appealing, but suffers from many fundamental flaws.
Here's one key reason. Corporate accounting is primarily done on a GAAP basis, using accrual accounting. Government accounting is primarily done on a non-GAAP cash-flow basis. To directly compare the books of a government agency with those of a corporation is to compare apples to oranges.
For example, when a corporation wants to build a factory, it has to obtain the capital from somewhere (debt or equity financing). The factory gets written up as an asset, the debt gets written up as a liability, and the equity gets written up as equity. The factory asset is then written off as depreciation over its lifetime as a useful asset. The interest on the debt shows up as an expense on the income statement, while the earnings from the factory sales show up as a profit.
If the corporation uses purely equity financing, its balance sheet will show a GAAP profit much higher than if it uses purely debt financing, because GAAP does not require you to charge yourself a "cost of capital" on your equity -- even though equity financing is hardly free. Generating profits and returning them to your shareholders *IS* the cost of equity financing!
To look at a GAAP corporate balance sheet and see a profit and therefore conclude that the corporation is overcharging its customers is faulty reasoning. In fact, if you want to determine the *economic* profit being earned by a corporation, you really need to look at other factors like the corporation's return on equity. For example, if a corporation is earning a 5% return on equity, it is actually incurring economic *losses* -- its profits are too small compared to the capital it is consuming. Further, you must adjust the return on equity to take into account the risk that the corporation is incurring, and to account for various cyclical factors.
The health insurance industry has a return on equity of approximately 12.2%. (http://biz.yahoo.com...
) This is not terribly out of line with the rest of the economy, and indicates to me that health insurance companies are in fact earning very little in the way of economic profits on average.
When the government publishes its budget numbers, it is *not* generally using GAAP. It is using cash flow accounting: cash receipts and cash outlays. This is a badly flawed way of doing accounting as soon as capital expenditures enter the picture. It doesn't properly account for things like accounts receivable and payable, inventory, depreciation, cost of capital, and so on.
An insurance company that ran its books the way Social Security or Medicare do would find itself very quickly facing a lawsuit. For example, in accrual accounting, when you receive insurance premiums, you cannot just write them up as a profit immediately. You have to write up a corresponding estimated liability for the fact that down the road, you are probably going to have to *pay out* some money too.
Some examples, for starters
I would propose completely eliminating all the following federal programs -- just a random smattering for starters, and hardly a complete list.
- Hybrid vehicle tax credits
- Farm subsidies
- Amtrak subsidies
- Space shuttle
- Privatize air traffic control system
- CAFE fuel economy standards
- Advanced Technology Program
- Small Business Administration
- Partnership for a New Generation of Vehicles
- Corporation for Public Broadcasting
- National Endowment for the Arts
I would also propose devolving the vast majority of the functions of the Departments of Education, Health and Human Services, Housing and Urban Development, and Interior to the states.
Running these programs at the state level allows states to experiment with different policies so we can see what works and what doesn't. It allows different parts of the country to better tailor the programs for their particular regional needs. It forces states to compete with each other to offer the best services at the lowest level of taxes. And it allows for better citizen oversight of government, because it's easier for you to personally influence (or even be elected or appointed to!) your city government than your county government; your county government than your state government; and your state government than the federal government.
False. I'm not a libertarian, but there are several reasons I dislike these programs that have nothing to do with this. Let's pick Social Security.
My first big problem with Social Security is that it's an intergenerational scam where my generation is getting ripped off compared to people born in earlier years. Each generation of successive people going through the system is getting a worse deal than the previous generation, because the system originally had the levels of taxes and benefits set at unsustainable levels, and because the first generation of SS recipients never had to pay *anything* into the system. Current SS recipients are getting a great deal. Future SS recipients are going to get a very raw deal to make up for this.
My second big problem with Social Security is that it's one size fits all. SS offers one particular package of retirement benefits, survivorship benefits, and disability benefits. Don't like that package? Too bad. For example, there's no provision that allows you to say "I don't think I need the retirement benefits so much, but I really should sign up for *more* disability benefits."
My third big problem with Social Security is that the benefits you are promised are not legally binding. Congress is free to cut them at any time if they become too much of a strain on the federal budget. Therefore, the benefits are not really guaranteed in any true sense. Some "security!" Congress should make Social Security benefits, once earned, legally binding obligations of the Treasury. That way, the *only* way your benefits could be lost is if the US government were to default on its debt.
Oh, please... it's unreasonable to expect me to reply to every single comment in every single post.
Somewhat off topic
What do you think of the SCO lawsuits?
Pretty sure I remember liberals griping along those lines in 2004! While you're right, there's just no way a meritocracy could work in practice. Like communism, it depends on people being "noble" and perhaps acting against their self-interest. Personally I think my vote should count for at least 10, since I'm so well-informed and all, but I imagine others might disagree with my preferrred weighing.
Come, my friends. 'Tis not too late to seek a newer world -- Tennyson
asdf
This type of statement always makes me testy. Does being "impervious to being 'solved'" mean that the government should quit trying to alleviate?
Take poverty, for example. As long as there are human beings on this earth, there will be poverty. Not all people will rise to the top of the economic ladder, nor even to the middle.
Do we let the poor just starve there in their huddled masses because we'll never end poverty?
Just because there is a condition that are fundamental to human nature doesn't mean that the government shouldn't take steps to try to fix it. If we never strive to fix "impervious" problems, we will never make any difference.
Yeah, you're right about some conditions being impervious to being fixed. They'll stay that way unless we work to change that paradigm.
Government is what it does
Vertically and especially horizontally integrated companies, used to be illegal. There was a good reason for this, it is cheating in the case of the vertical monopoly, and tyranny in the case of the horizontal monopoly.
Talk of efficiency is cover for the real point of increased power. To understand what increased size does for efficiency think 10 acre hamburger joint. To understand what size does for power think McDonald's or better Mal-wart.
Likewise taxes and Government oversight had a salutary effect on how Corporations were run. The tax structure meant that plant and infrastructure reinvestment, particularly when was only in U.S. was encouraged, and ripoff and run was heavily taxed at best and possibly a prison term as well.
With the change in Tax structure, the Middle classes got socked with the highest taxes (since it included FICA)and far from encouraging reinvestment, the American landscape is littered with the empty husks of perfectly good companies, sucked dry and the money taken elsewhere.
Your argument that the Computer chip industry is competitive belies the fact that consumer electronics (still a very young industry)is still one of the few actual free enterprises (commodity markets)left, though for how long is a big question mark. As soon as one company (or a couple working together)is able to force all the others out of business, such advancements will come to a crawl if not a screeching halt. Prices will also rise as there would now be little to restrain them. That is already happening in parts of the industry.
They do worse, the Congress has taken the SS funds for other programs leaving an IOU that Republicans want to burn so they don't have to actually pay it. That is bad enough.
The Insurance companies play fast and loose with their "estimated liability", write off most of the looting by management as a "business expense", and when the bill comes due they either dodge it ("you were insured against a Hurricane, but your house got wet and we don't cover floods"), or if the looting has been big enough, they just go bankrupt and leave everyone, investors and customers in the lurch.
Oh and "Tort Reform" means you can't reasonably sue them anymore either.
The Self Made Man is just not admitting where he got all the parts.
Space Shuttle?
Are you against NASA in general? Do you think the space program would have been funded by corporations or at the state level?
Two points
The reason why government shouldn't run all businesses is because government is not a good mechanism for entrepreneurship. The best model we have for fostering innovation is that of people being able to form new enterprises based upon their own ideas. Central planning cannot take into account all the ways people can be creative. That's why centralized economies (like the USSR) lagged behind in innovation.
It is also one of the reasons that monopolies don't innovate. Their dependence on easy profits squelches innovation within the firm and also prevents meaningful competition from forming. Notice that when AT&T was broken up it was rapidly followed by a huge growth in the number and types of communication services developed.
Big business is perfectly willing to gut essential services (the railroads come to mind) and then the government is forced to take them over.
Point two:
The end of your remarks above show your fundamental distrust of democracy. This is in perfect keeping with the RWA personality type (that's you whether you acknowledge it or not). The problem with having an elite decide things is:
1. They don't necessarily know what is best (some problems have no clear best solution).
2. They are not subject to the corrective actions of the "market place", that is the general public.
3. Who becomes the elite is based upon arbitrary criteria (like being born into a wealthy or influential family).
4. Decisions made without the agreement of the majority are not likely to be acted upon with sufficient enthusiasm. Slaves don't make good workers.
I'm sorry you don't approve of our (imperfect) form of government, but democracy is the best we've come up with so far. If you feel so superior to the rest of the population maybe you should move to one of the fine countries that embodies your ideals - Zimbabwe, Kazakhstan or perhaps China . If you are fortunate to be one of the elite you will have a comfortable life, on the other hand if you cross the leaders in some unknowable way you may find your options someone limited.
PS. Without opening the entire debate again about Microsoft, you really need to read up on the evidence that came out of the various trials. The number of illegal things that they did to become a monopoly might interest you. Just today there are stories about PC makers being gouged over the licensing conditions for the new Vista OS.
--- Policies not Politics
NASA
Yes, I would consider NASA generally an ineffective use of tax dollars. No, many of those missions would *not* have been funded elsewhere -- because many of them are a waste. Was it really worth $650M in taxpayer dollars to send a space probe to Pluto? In my opinion, no.
SCO and democracy
I did not follow them closely enough to judge the technological merit of what SCO was claiming.
My point is *not* that we should change our voting system in America to give different people different numbers of votes (although I *am* quite partial to my boss's proposal that you should get one vote per dollar in taxes that you pay -- not that it would ever actually happen).
My point is that other systems, like the market, are usually better ways of making many classes of important decisions than democracy. Democracy is a particularly bad way of making decisions about how best to allocate scarce resources.
Reply
First, two quick points.
So why, then, do you think that government *should* run at least certain portions of the health care and insurance industries? Are you not therefore squelching enterpreneurship in those industries also?
Actually, I followed the Microsoft trials in great detail -- they were of great personal interest to me, seeing as they directly relate to my field of employment. I stand by my remarks. I consider Microsoft the victim of unjust persecution.
On to the important point:
This is a straw man. I don't advocate that all decisions should be made by some sort of "elite." I advocate that decisions about how to allocate scarce resources should be made primarily through the market process, not through a democratic process.
For example, there should *not* be a committee of "smart people" somewhere that decides, for each parcel of land in America, who should be allowed to use it this year and for what.
We should *not* have a vote in my county where leading real estate developers get to offer plans for how they plan to develop a piece of land, and the citizens of the county decide which plan wins by casting one vote each.
Instead, land should be privately owned, and if you want to buy it, you should have to make an offer to its current owner that the current owner is willing to accept. Once you own it, it is up to you to decide what to do with it.
There are compelling reasons to believe democracy is a mediocre way of making many types of important decisions. Let me just touch on a few.
1. Kenneth Arrow's voting theorem (http://en.wikipedia....
). Arrow proved that it is impossible to design a "fair" voting scheme when there are three or more options on the ballot. All such voting schemes must inevitably suffer from important flaws.
2. The classic arguments made in The Federalist Papers by James M