intersection

the Church, the State, and me

Lord, thou hast made us for thyself, therefore our hearts are restless until they rest in thee.
- St. Augustine of Hippo
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Posts tagged "Economics"

Color me surprised…not. Because it never was about health care–it’s all about government overreach, always for our own good. From the Daily Caller:

…Massachusetts Institute of Technology economist Jonathan Gruber, who also devised former Massachusetts Gov. Mitt Romney’s statewide health care reforms, is backtracking on an analysis he provided the White House in support of the 2010 Affordable Care Act, informing officials in three states that the price of insurance premiums will dramatically increase under the reforms.

In an email to The Daily Caller, Gruber framed this new reality in terms of the same human self-interest that some conservatives had warned in 2010 would ultimately rule the marketplace.

“The market was so discriminatory,” Gruber told TheDC, “that only the healthy bought non-group insurance and the sick just stayed [uninsured].”

“It is true that even after tax credits some individuals are ‘losers,’” he conceded, “in that they pay more than before [Obama’s] reform.”

Gruber, whom the Obama administration hired to provide an independent analysis of reforms, was widely criticized for failing to disclose the conflict of interest created by $392,600 in no-bid contracts the Department of Health and Human Services awarded him while he was advising the president’s policy advisers.

Gruber also received $566,310 during 2008 and 2009 from the National Institutes of Health to conduct a study on the Medicare Part D plan….

“As a consequence of the Affordable Care Act,” [President Obama] said in September 2010, “premiums are going to be lower than they would be otherwise; health care costs overall are going to be lower than they would be otherwise.”

Gruber’s new reports are in direct contrast Obama’s words — and with claims Gruber himself made in 2009. Then, the economics professor said that based on figures provided by the independent Congressional Budget Office, “[health care] reform will significantly reduce, not increase, non-group premiums.”

During his presentation to Wisconsin officials in August 2011, Gruber revealed that while about 57 percent of those who get their insurance through the individual market will benefit in one way or another from the law’s subsides, an even larger majority of the individual market will end up paying drastically more overall.

“After the application of tax subsidies, 59 percent of the individual market will experience an average premium increase of 31 percent,” Gruber reported….

Read it all. Why do we continue to listen to “experts” who seem to have no understanding of human nature and how that affects the market? Sigh…

From Matthew Continetti at the Washington Free Beacon:

Polling shows that the economy remains voters’ top priority. But there are signs that the business situation is improving. The dropping unemployment rate is just one example of good economic news. U.S. growth may be subpar, but it is growth nonetheless. Conservatives would be foolish to think that the media will dwell on the economy’s weak spots when the president is a Democrat and his party controls the Senate.

Running bulls will bring in additional revenue to the U.S. Treasury, which will temporarily mask the country’s dire long-term fiscal predicament. The dollar’s status as the global reserve currency will stave off inflation and high interest rates for a while longer. The administration will claim credit despite doing everything in its power to reward friends and punish enemies, delay the recovery, and increase the cost and intrusiveness of government. But even that may not be enough to secure the president’s reelection.

Why? Because culture trumps economics. The tenor of news coverage might lead one to believe that the assault on the Susan G. Komen for the Cure Foundation for ending donations to Planned Parenthood, and the debate over the administration ruling that universities and hospitals with religious affiliations must provide contraception to their employees, are winning issues for the Democrats. But any Democratic strategist planning a campaign around these issues might want to think twice.

Such controversies tend to mobilize conservatives more than liberals. As longtime consultant and analyst Jeffrey Bell observes in his excellent book, The Case for Polarized Politics, social issues tend to separate the populist, socially conservative mass from the progressive elite. That is why Republican social policy has been an electoral winner, whether the topic is crime or patriotism or affirmative action or abortion or religious liberty….

The debates over Komen and contraception are not solely about abortion and health care. They are both instances of a liberal minority attempting to coerce an organization to perform acts against its will. Patty Murray’s ridiculous suggestion that Komen’s “dangerous” decision to eliminate the grant to Planned Parenthood was the result of a “partisan witch hunt” is beside the point: Civil associations in a free society have every right to give money to whichever organizations they choose. Meanwhile, Barbara Boxer, M.D., can tell MSNBC that the Department of Health and Human Services contraceptive regulation is “a medical issue” all she wants; it does not change the fact that, if the regulation goes into effect, institutions affiliated with the Catholic Church will be forced to do something that violates fundamental tenets of their religion.

Both stories fit the classic pattern of post-cultural-revolution politics…

Tying the president’s fiscal policies to broader questions of society, culture, life, and freedom is the more effective route, because on these questions Obama has nowhere to go. He is a prisoner of his ideological biases. His elitist defense of social progressivism likely will lead him to commit a gaffe similar to when he said that the Cambridge police acted “stupidly” in arresting Professor Gates of Harvard….

Read it all.

From Christians for a Sustainable Economy:

The crisis of the modern welfare state is a crisis of government, and it is more than that. Too many private charities and foundations dispense aid on the basis of what feels good rather than what works. As a result, they end up providing, instead of points of light, alternative shades of darkness….

Private charities and foundations can do a better job than government but only if they follow seven principles that effective poverty fighters of the past understood. Here are the principles, with historical meaning and contemporary applications, in alphabetical order.

1. Affiliation

A century ago, when individuals applied for material assistance, charity volunteers tried first to “restore family ties that have been sundered” and “reabsorb in social life those who for some reason have snapped the threads that bound them to other members of the community.” Instead of immediately offering help, charities asked, “Who is bound to help in this case?” Mary Richmond of the Baltimore Charity Organizing Society summed up in 1897 the wisdom of a century: “Relief given without reference to friends and neighbors is accompanied by moral loss. Poor neighborhoods are doomed to grow poorer whenever the natural ties of neighborliness are weakened by well-meant but unintelligent interference.”

5. Employment

New York charity leader Josephine Lowell wrote that “the problem before those who would be charitable, is not how to deal with a given number of the poor; it is how to help those who are poor, without adding to their numbers and constantly increasing the evils they seek to cure.” If people were paid for not working, the number of nonworkers would increase, and children would grow up without seeing work as a natural and essential part of life. Individuals had to accept responsibility: Governmental programs operating without the discipline of the marketplace were inherently flawed, because their payout comes “from what is regarded as a practically inexhaustible source, and people who once receive it are likely to regard it as a right, as a permanent pension, implying no obligation on their part.”

Today, programs that stress employment, sometimes in creative ways, need new emphasis….

6. Freedom

Charity workers a century ago did not press for governmental programs but instead showed poor people how to move up while resisting enslavement to governmental masters. Job freedom was the opportunity to drive a wagon without paying bribes, to cut hair without having to go to barbers’ college, and to get a foot on the lowest rung of the ladder, even if the wages there were low. Freedom was the opportunity for a family to escape dire poverty by having a father work long hours and a mother sew garments at home. Life was hard, but static, multigenerational poverty of the kind we now have was rare; those who persevered could star in a motion picture of upward mobility.

Today, in our desire to make the bottom rung of the ladder higher, we have cut off the lowest rungs and left many on the ground. Those who are pounding the pavements looking for work, and those who have fallen between the cracks, are hindered by what is supposed to help them. Mother Teresa’s plan to open a homeless shelter in New York was stopped by a building code that required an elevator; nuns in her order said that their code forbade such mechanical helps and that they would carry upstairs anyone who could not walk, but the city stuck to its guns and the shelter never opened….

7. God

“True philanthropy must take into account spiritual as well as physical needs,” poverty fighters a century ago noted, and both Christians and Jews did. Christians worshipped a God who came to earth and showed in life and death the literal meaning of compassion—suffering with. Jewish teaching stressed the pursuit of righteousness through the doing of good deeds. Groups such as the Industrial Christian Alliance noted that they used “religious methods”—reminding the poor that God made them and had high expectations for them—to “restore the fallen and helpless to self-respect and self-support.”

Read it all, check out their site and check out their letter to President Obama.

From James Pethokoukis at the American Enterprise Institute:

So, while the Reagan Recovery quickly made up for lost years of growth, not so much for the Obama Recovery, as this chart in today’s Wall Street Journal makes clear:

runningbehind_economics (The Wall Street Journal)

And few economists are expecting the Obama Recovery to take off anytime soon. The IMF predicts just 1.8 percent growth for 2012 (and that’s assuming no EU sovereign debt meltdown). And the Federal Reserve sees growth in the 2.2 percent to 2.7 percent range with unemployment around 8.2 percent to 8.5 percent. Ugh!

The WSJ offers two explanations for the anemic rebound:

Economists say the nature of the recession helps explain the slow recovery. Aftershocks from the financial crisis have left banks reluctant to lend, making it hard for companies, and especially start-ups, to get access to capital. The housing market, which has historically helped lead the economy out of recession, remains deeply depressed.

Many business leaders say they are also being held back by policy-related uncertainty, everything from the threat of new regulations and higher taxes to the fear that political gridlock could hamper the government’s ability to respond to a new crisis. Recent economic research has given some weight to those complaints. A study by a trio of academic economists found that policy uncertainty has risen in recent years, and that periods of uncertainty have in the past corresponded with rising unemployment and slowing growth.

Read it all.

From Business Insider:

Real GDP increased 1.7 percent in 2011 (that is, from the 2010 annual level to the 2011 annual level), compared with an increase of 3.0 percent in 2010….

We’re going in the wrong direction—not exactly a vote of confidence for the administration’s economic policies.

Check it out.

From John Hayward at Human Events, a note that transporting oil by rail is much more environmentally dangerous than using a pipeline, but not as financially advantageous to the well-connected crony capitalists:

…Amusingly, a spokesman for the Sierra Club admitted “there is no question that [transporting] oil by rail or truck is much more dangerous than a pipeline,” but that didn’t stop the zero-growth eco-fanatics from calling in their chips with President Downgrade to kill that pipeline.

Those rail shipments are expected to “increase exponentially with increased oil production and the shortage of pipelines,” according to Justin Kringstad, director of the North Dakota Pipeline Authority. That’s going to be quite a windfall for the railroad companies, isn’t it?

As it happens, 75 percent of the oil currently shipped by rail out of North Dakota is handled by Burlington Northern Santa Fe LLC… which just happens to be a unit of Warren Buffett’s company, Berkshire Hathaway Inc. What a coincidence!

For some reason, nobody from BNSF or Berkshire Hathaway would return the AP’s telephone calls, but oilman Harold Hamm told them he was sure this was just a wonderful “lucky break” for Barack Obama’s favorite billionaire, who is “certainly favored by this decision.” I’ve heard Buffett’s famously overtaxed secretary will be a guest at the State of the Union address tonight. Maybe someone could ask her about it….

Read it all.

Because crony capitalism is just that, very, very crony:

…As it turns out, it is not just natural resources and aquifer purity that Obama had in mind when sealing the fate of the Keystone XL pipeline. No - it appears there were far more relevant numerial metrics that determined Obama’s decisions. Such as the bottom line number of Buffett’s Burlington Northern, which according to Bloomberg, is among U.S. and Canadian railroads that stand to benefit from the Obama administration’s decision to reject TransCanada Corp.’s Keystone XL oil pipeline permit….

Read it all, and more here from Bloomberg:

Warren Buffett’s Burlington Northern Santa Fe LLC is among U.S. and Canadian railroads that stand to benefit from the Obama administration’s decision to reject TransCanada Corp. (TRP)’s Keystone XL oil pipeline permit….

“Whatever people bring to us, we’re ready to haul,” Krista York-Wooley, a spokeswoman for Burlington Northern, a unit of Buffett’s Omaha, Nebraska-based Berkshire Hathaway Inc. (BRK/A), said in an interview. If Keystone XL “doesn’t happen, we’re here to haul.”…

Tallest Skyline by CTBUHFrom arch daily:

The Council on Tall Buildings and Urban Habitat recently published The Tallest 20 in 2020: Entering the Era of the Megatall. Within this decade, the World’s first kilometer-tall building will be constructed, along with many other buildings over 600-meters tall. “The term “supertall” (which refers to a building over 300 meters) is thus no longer adequate to describe these buildings: we are entering the era of the “megatall.”

At the start of the 21st century, the 452-meter high Petronas Tower held the title of “The World’s Tallest.” As the decade ended, the Burj Khalifa took ownership of the title standing “over half a mile” high at 828-meters. Now, construction set to begin this month for Jeddah’s 1,000+ meter Kingdom Tower, doubling the height of “The World’s Tallest” in only two decades. It seems that “600m seems to be the new 300m.”

Check it out.

Drawing on the story of Elizabeth and Zacharias from the Gospel of Luke , Mark Steyn writes:

…The notion of life as a self-growth experience is more radical than it sounds. For most of human history, functioning societies have honored the long run: It’s why millions of people have children, build houses, plant trees, start businesses, make wills, put up beautiful churches in ordinary villages, fight and if necessary die for your country … A nation, a society, a community is a compact between past, present, and future, in which the citizens, in Tom Wolfe’s words at the dawn of the “Me Decade,” “conceive of themselves, however unconsciously, as part of a great biological stream.”

Much of the developed world climbed out of the stream. You don’t need to make material sacrifices: The state takes care of all that. You don’t need to have children. And you certainly don’t need to die for king and country. But a society that has nothing to die for has nothing to live for: It’s no longer a stream, but a stagnant pool….

Read it all.

From David Daniel Hannan, writer, journalist, and Conservative MEP for South East England since 1999:

Chatting to some Occupy protesters this morning, I was struck by how wide of the mark were the beliefs they attributed to me as a Right-winger. In the interests of deeper understanding, here are ten things which – trust me – most of the Tory scum I hang around with think. Obviously, I don’t expect to turn my Leftie readers in a single post; still, they might get a clearer idea of what we actually believe.

1. Free-marketeers resent the bank bailouts. This might seem obvious: we are, after all, opposed to state subsidies and nationalisations. Yet it often surprises commentators, who mistake our support for open competition and free trade for a belief in plutocracy. There is a world of difference between being pro-market and being pro-business. Sometimes, the two positions happen to coincide; often they don’t.

2. What has happened since 2008 is not capitalism. In a capitalist system, bad banks would have been allowed to fail, their profitable operations bought by more efficient competitors. Shareholders, bondholders and some depositors would have lost money, but taxpayers would not have contributed a penny (see here).

3. If you want the rich to pay more, create a flatter and simpler tax system. …

Read it all.

usgovernmentspending.com

From the Bookworm Room:

This helps to understand the US debt:
• U.S. Tax revenue: $2,170,000,000,000 
• Fed budget: $3,820,000,000,000 
• New debt: $ 1,650,000,000,000 
• National debt: $14,271,000,000,000 
• Recent budget cut: $ 38,500,000,000 

Let’s remove 8 zeros and pretend it’s a household budget:
• Annual family income: $21,700 
• Money the family spent: $38,200
• New debt on the credit card: $16,500
• Outstanding balance on the credit card: $142,710
• Total budget cuts: $385

CLEARER, huh?

Check it out.

On You Tube (thanks, Daily Caller), Milton Friedman discusses how the “magic of the price system” comes together to produce items as simple, and as complex, as an ordinary pencil:

This was first written about in 1958 by Leonard Read in his essay, I, Pencil: My Family Tree as told to Leonard E. Read:

…My family tree begins with what in fact is a tree, a cedar of straight grain that grows in Northern California and Oregon. Now contemplate all the saws and trucks and rope and the countless other gear used in harvesting and carting the cedar logs to the railroad siding. Think of all the persons and the numberless skills that went into their fabrication: the mining of ore, the making of steel and its refinement into saws, axes, motors; the growing of hemp and bringing it through all the stages to heavy and strong rope; the logging camps with their beds and mess halls, the cookery and the raising of all the foods. Why, untold thousands of persons had a hand in every cup of coffee the loggers drink!…

There is a fact still more astounding: the absence of a master mind, of anyone dictating or forcibly directing these countless actions which bring me into being. No trace of such a person can be found. Instead, we find the Invisible Hand at work. This is the mystery to which I earlier referred….

I, Pencil, am a complex combination of miracles: a tree, zinc, copper, graphite, and so on. But to these miracles which manifest themselves in Nature an even more extraordinary miracle has been added: the configuration of creative human energies—millions of tiny know-hows configurating naturally and spontaneously in response to human necessity and desire and in the absence of any human master-minding!

The above is what I meant when writing, “If you can become aware of the miraculousness which I symbolize, you can help save the freedom mankind is so unhappily losing.” For, if one is aware that these know-hows will naturally, yes, automatically, arrange themselves into creative and productive patterns in response to human necessity and demand—that is, in the absence of governmental or any other coercive masterminding—then one will possess an absolutely essential ingredient for freedom: a faith in free people. Freedom is impossible without this faith….

Read emphasizes the necessity of faith in the freedom of man to create what is needed and desired without the overarching regulation and mandates of a central government while Friedman emphasizes the pull and push of the marketplace, riffing off of Read’s essay.

But then again, Friedman did write the introduction to Read’s book:

…I know of no other piece of literature that so succinctly, persuasively, and effectively illustrates the meaning of both Adam Smith’s invisible hand—the possibility of cooperation without coercion—and Friedrich Hayek’s emphasis on the importance of dispersed knowledge and the role of the price system in communicating information that “will make the individuals do the desirable things without anyone having to tell them what to do.”…

Whatever the pressure, [Read] stuck to his guns, refusing to compromise his principles. That was why he was so effective in keeping alive, in the early days, and then spreading the basic idea that human freedom required private property, free competition, and severely limited government.

Interesting…