Warren’s Proposals

We have tried to ignore the silliness on the left with regards to energy with the Green New Deal and all of that.  It seems to us that those were dead ideas and that is a really good thing.  Now we see some of the worst of those ideas coming from a serious contender for the Democrat nomination for president.    We concur with Jay Nordlinger at the NRO Corner:

Early last month, Elizabeth Warren issued a tweet that sent a chill down my spine: “On my first day as president, I will sign an executive order that puts a total moratorium on all new fossil fuel leases for drilling offshore and on public lands. And I will ban fracking — everywhere.”

Jay goes on to discuss the impact of such ideas on the Saudis and our allies.  We”d like to discuss why seeing Elizabeth’s tweet sent a chill down our spine and it should send one down your spine too.  It makes us glad we are not on Twitter.

We would like to look at the two sentences individually.  In the first she has a method, executive order, and a goal, no NEW leases offshore or on public lands, that seems consistent with the method.  It is a really, really bad idea and it will probably be challenged in court but it might happen.  Mark Perry at Carpe Diem consistently covers the increase in US oil output and here is an example.  Our guess is that most of this output comes from private lands so Elizabeth is being foolish and engaging in some cronyism to help her friends and donors in “alternative energy” but she hasn’t proposed anything catastrophic.

Well, she hadn’t proposed anything catastrophic until the next sentence.  There are three terrifying parts of the second sentence.  First there is “everywhere.”  Perhaps “everywhere” is just a little political overstatement but we hope she doesn’t think she can ban it globally.  Second there is the unspecified process that will allow her to ban fracking.  Some folks have been worried by the authoritarian impulses of The Donald and the 44th president.  This would take the imperial presidency to a whole different level.  And worst of all there is the banning of fracking.  It is a disaster on many levels that it is impossible to create a comprehensive list but here are a few.  There is all the value generated by fracking.  There are all the folks and organizations that support fracking.  There are all the organizations, like manufacturing, that benefit from cheap energy.  There is the environmental impact of reduced CO2 from using cleaner natural gas.  There are the international problems for the US and our allies of being back under the control of Russia and the Middle East.

Sidebar: The Donald is often accused of being an agent of Russia despite his actions.  We think Elizabeth is just a fool but her behavior in banning fracking would support Russia’s most important goal, increasing the price of energy.  End Sidebar.

An executive order to forbid new energy from public lands is ordinary political stupidity like The Donald’s trade war.  Elizabeth has moved to a whole different level when she says she will ban fracking.  It is astonishing that people take her seriously.

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Good News, Bad News, Good News

We have been enjoying not being a paid pundit.  Those folks had to watch CNN Climate Change Town Hall.  Did we mention that it was seven hours long?  David Harsanyi at the Federalist has a nice summary: It was insane.  Elsewhere at the Federalist they have created their list of the ten craziest things at the Town Hall.  They didn’t even declare this the winner.   The folks who did that are way, way underpaid.  Then, while we were enjoying our week, Robert Mugabe died.  Our initial reaction way very much like Jim Geraghty: What a joy it is to be able to use the past tense for Robert.

Of course, the bad news is that the folks featured on the Town Hall are running for the Democrat nomination for president in 2020.  The “serious” candidates tend to be the most worked up about climate change.  Here is a tweet from the ten craziest things that ranks the candidates on their climate change proposals:

Tonight’s the . Here’s @greenpeaceusa‘s grades for the participating 2020 candidates.

Bernie Sanders: A
Elizabeth Warren: A-
Cory Booker: A-
Kamala Harris: B+
Joe Biden: B+
Julián Castro: B
Pete Buttigieg: B
Beto O’Rourke: B-
Amy Klobuchar: C+
Andrew Yang: C+

Amy gets a C+ for wanting to spend two to three trillion dollars (and we are certain that all cost figures are wildly understated) on climate change.  To get an average or above grade, as all the leaders in the polls did, you have to spend serious money and have serious infringement of freedom.  Nukes?  No thanks (nice song reference John).

The good news is that Big Oil seems to be ignoring all of this.  Of course, most of the fracking is done by smaller outfits and they don’t need to worry about being woke.

Sidebar: We were trying to confirm the last sentence by searching “Who does fracking?”  Almost all of the responses we got were about the “dangers” of fracking.  We still think Big Oil does not lead the fracking parade.  End Sidebar.

But Big Oil is always worried, watch their ads, about where they stands politically because their size makes them vulnerable.  Yet (from the above link):

Major oil companies have approved $50 billion of projects since last year that will not be economically viable if governments implement the Paris Agreement on climate change, think-tank Carbon Tracker said in a report published on Friday.

This is great news as we don’t need to worry about the frackers.  We shall see what happens.  Will the Town Hall insure another term for The Donald?  Will some Democrat be reasonable and popular?  When?  And why did our paragraph change?

Losing Robert and seeing that Big Oil is not too scared makes it net out to a good week.  We are still worried about climate change policy but are happy that our paragraph form changed back.

 

 

End Of A Specious Argument?

James Freeman on the WSJ’s Best Of The Web tries logic on the folks that want to try to reduce income inequality.  Do read the whole thing.  We think it is unlikely to work but it might help the voters make a better decision in the general election.  He starts with an assertion:

Leftist politicians have been saying for years that a dramatic rise in wealth and income inequality is the central economic problem of our time.

We are not sure that those leftists care about the changes in income inequality.  Our guess, and it is only a guess, is that they think there there are more folks that think they would benefit from eating the rich than there are folks that worry about being eaten.  James hopes that an academic paper by Gerald Auten and David Splinter

Sidebar: Yes splinter is a bridge bid but we are not making this up.  If we did, however, then Splinter would be one of the authors but Gerald would need a new name and Splinter a first.  How does Diamond Splinter and Bergen Raises sound for the two authors?  End Sidebar

will eliminate the premise to the argument.  We don’t think that logic will stop folks from selling envy.  Here is part of what James says about the new paper:

After a draft of the paper was released last year, Paul Solman of the PBS NewsHour of all places wrote:

You thought income inequality was rising dramatically, right? Well, so did I. In fact, maybe you thought so in part because I and journalists like me have been reporting it as fact, for decades. But maybe we’re wrong — all of us.Mr. Solman reported that the Auten-Splinter draft paper enjoys widespread respect in the economics profession—even if not everyone is willing to admit it.  [Emphasis added]

We don’t like the of all places dig in bold.  Our information is the the PBS NewsHour is only slightly left of center unlike the rest of PBS.  But the second bold item is really damming to about the group-think of journalists.  James tells us that the paper is well received even by those on the left.

We don’t see that Auten-Splinter have any impact on us and we doubt it will have leftist politicians James hopes to convince.  It won’t have any impact on us because we care about growth much more than inequality.  To be precise, at the current levels of inequality in the US we don’t care about it at all.  We do want the growth fairy to come and visit.  We think that the government has been far too worried about inequality and related issues and not worried enough about growth.  An example of this is The Donald, whose administration has sometimes helped growth but his trade wars have not.  No administration has emphasized growth enough.  Growth should be a higher priority than it currently is.

The left doesn’t agree.  They want to increase the emphasis on distribution.  We don’t think they will be deterred by logic from James.  They think envy sells and we are concerned that they might be right.  Will a specious argument be enough?

 

Good Ideas, Bad Ideas, And Bad Claims

The left cannot claim to have all the bad economic ideas.  They have the worst as we see in Venezuela but they do not have exclusive rights to such ideas.  There are lots of ideas out there and some of them are good but to get them noticed folks often make extreme claims.  Thus, good ideas get dismissed because they are not quite as good as the claims suggest.

Our example of a bad idea comes from Cesar Conda at NRO.  He says:

President Trump should propose exactly what President Barack Obama did in 2011: a temporary reduction in the Social Security portion of the payroll tax from 6.2 percent to 4.2 percent.

Cesar Conda is:

a former Bush-Cheney White House domestic-policy adviser and senior aide to three Republican U.S. senators, is founding principal of Navigators Global.

He is writing at NRO.  It is not unreasonable to take him seriously.  We shouldn’t.  Part of his argument is economic growth and we are fans of the growth fairy.  Economic growth is critically important and we believe that governments can influence the growth fairy.  But the way to get the growth fairy on your side is through long-term policies.  Countries with policies that support economic freedom like enforcing the rule of law, having low corruption, low regulation, low taxes, and free trade are highly likely to be visited by the growth fairy.  Going in the opposite direction then the more likely the growth fairy won’t visit.

The best you can hope for with Cesar’s idea is to move growth around.  It was one of many bad ideas from the 44th president.  It is worse now given the deficit and the near insolvency of Social Security.

Sean Maskai Flynn at Market Watch has two really good ideas for improving health care and reducing or limiting the costs.  They are good ideas because they are long-term and make healthcare more of a marketplace than it currently is.  First, we need transparent health care prices:

The first policy—price tags—is a necessary prerequisite for competition and efficiency. Under our current system, it’s nearly impossible for people with health insurance to find out in advance what anything covered by their insurance will end up costing. Patients have no way to comparison shop for procedures covered by insurance, and providers are under little pressure to lower costs.

Absolutely.  And second we need health savings accounts (HSA) that revert to the owner or can be extended into future years.  We don’t agree with Sean that the employer needs to “gift” them and he is surely wrong that it is a gift.   Any such payment is surely part of compensation rather than a gift.  We are not sure of how such a payment would be treated by the IRS.  The tax treatment of HSA need to be part of the solution.  We think the important points are high HSA limits and the opportunity to move amounts among years.

The second policy—deductible security—pairs an insurance policy that has an annual deductible with a health savings account (HSA) that the policy’s sponsor funds each year with an amount equal to the annual deductible.

The details are important but the problem is that the headline says these two changes would reduce health care costs by 75 percent.  Nope.  The text says they will provide $2.4 trillion [yup, trillion] per year in savings.  Since health care spending in 2017 was $3.5 trillion this gets another Nope.  Still, transparent prices and HSA with high limits and methods to move amount into other years or revert to the owners are great ideas.  Temporary tax changes are not.  Realistic claims are another good idea.

 

Bobby, Kris, and Janis

We really enjoy Daniel Henniger but recently he went too far.  Dan is at the WSJ discussing Does Hong Kong Matter?   Well, of course it does but it also depends.  Are we going to cause WW III over it?  Unlikely.  Is Dan going to use a really bad analogy about it to distract us from his reasonable point?  Absolutely.  Janis Joplin’s version Kris Kristofferson’s of Me and Bobby McGee is our all-time favorite song.  Dan should listen more closely.

Sidebar: Sometimes it is Bobbi and sometimes it is Bobby.  The Genius site uses Bobby so we are too.  End Sidebar.

Dan quotes Kris correctly but too briefly.  He says:

Someone once sang that “freedom’s just another word,” and maybe today it is. One casualty of the relentless U.S. political slog is that some important ideas—such as justice, racism, equality and respect—get so beaten into the ground, become so hackneyed, that one feels almost embarrassed to use the words.

The problem is there are lots of kinds of freedom.  Economic, political, and personal to make a short list.  Kris was talking about personal freedom.  The whole verse is:

Freedom’s just another word for nothin’ left to lose
And nothin’ ain’t worth nothin’ but it’s free
Feelin’ good was easy, Lord, when Bobby sang the blues
And buddy, that was good enough for me
Good enough for me and my Bobby McGee.

Personal freedom can be a negative as it was when Bobby set the songwriter free.  So the song ends:

Well I’d trade all my tomorrows for a single yesterday
Holdin’ Bobby’s body close to mine

Economic freedom and political freedom are positive goods while personal freedom can be positive or negative.  Dan needs to understand the difference between dating and Hong Kong.  There are different kinds of freedom and Hong Kong does matter.

Our Conservative Sensibility

July has been a good month for reading.  We have just finished George Will’s The Conservative Sensibility.  We hope to have a formal review for you later but we recognize we are in debt to the reader already.  Instead we want to discuss the rise of our own conservative sensibility.  We are less philosophically inclined than George and perhaps because of that our sensibility arrived later.

We went to Saint Anselm College (SAC) as an undergraduate but when we went there it had an apostrophe in the name.  We weren’t as aware of such things as we are now but we suspect it was more conservative than the average college then.  Grade inflation certainly hadn’t arrived.  We ended up with averages of 89.7 and 89.9 for two semesters in Chemistry and were told that you needed a 90.  That is why we tell faculty to use xx.0 if that is what they mean.  When we took introductory economics there were two sections and  two semesters in which no student got an A.

SAC was into assessment before we knew what assessment was.  To escape German we had a one-on-one conversation in the language with the good Father whose name escapes us.  To graduate in economics there was a multiple choice test, we think it was the Undergraduate Record Exam,   We don’t know if our memory is faulty, the Internet is, or if it doesn’t exist any more as we could only find the GRE.   In addition, there was an oral exam where each student was individually questioned by a group of economics faculty members.  We did not have a stellar, to be kind, undergraduate academic record. So when we went to discuss the results we were surprised to hear something like, if we didn’t pass you we couldn’t pass anyone.

George’s book reminded us of that and instructed us in why.  The economics department included some pretty progressive members.  One of the questions in the oral was why didn’t Nixon add profits to his wage and price controls.  Our answer was simple arithmetic.  If you controlled the prices of the inputs then you controlled the sums and differences.  We remember the interviewers stirring around on that answer.  George’s book points out why this is, in part, a conservative answer, and why it troubling to the progressives.  Of course, George is not the only one to point this out but he takes 600 pages to hammer it home.

It is a conservative answer because it avoids the passion and envy of we must control profits.  It troubles the progressives because they believe that they can do all the math to make government work to bend the economy to their will.  So telling them that it should be easy is a troubling answer for them.  Either it is easy or it is hard.  If it is hard then the whole progressive project falls to ruin.

 

 

Stuck In (The Middle?) With You?

Well, Stealers Wheel’s lyrics often come to mind when surveying the political scene.  The first two lines of the chorus are often apropos but the we have never before felt like the last two lines apply to us.  In case you forgot:

Clowns to the left of me
Jokers to the right

Here I am
Stuck in the middle with you

What has got us in a tizzy is Kevin Drum at Mother Jones is reminding us that National Health Care Is Free.  It is silly but we have read it so you don’t have to.  What is worrisome is the jokers on the right.  Paul Mirengoff at PowerLine reports that:

At the recent National Conservatism Conference in Washington, the crowd voted overwhelmingly in favor of a resolution calling for the United States to adopt an “industrial policy.” In so doing, the conservative crowd agreed with Sen. Elizabeth Warren who, as John [Hinderaker at PowerLine] has noted, also wants the U.S. to adopt such a policy.

The idea is for the government, through a set of policies — taxes, spending subsidies, regulation, and tariffs — to protect factory jobs against the forces of globalization and technological change.

Paul links to James Pethokoukis at AEI for an evaluation.  The headline is “GOP’s Stupid Swoon For Big Government.”  We are entirely on board on “Stupid” but this was the National Conservatism Conference rather than just Marco Rubio.  As the link shows, serious people were there.

As we are trying to deal with the level of disagreement on the right, we come across this from Rosie Gray in Buzz Feed News:

It’s an odd feature of American politics today that while the Republican party as an institution has never been more unified, the right has never been more ideologically fluid. Intellectual subgroups have had their moments in the sun: neoconservatives, libertarians. But they, and the Reaganites who have decided conservative dogma since the 1980s, have all diminished as Donald Trump has occupied all of the available breathing room on the right.

We can help Rosie with her confusion.  The GOP is as fractious as ever.  Just like the Democrat party.  The right has always had intellectual subgroups.  Each candidate brings a number of those subgroups together.  The Donald created a new one: NeverTrump.

Oh, back to Kevin and our concerns on the left.  Kevin is trying to convince us that national health care is free and he says:

You see, the vast bulk of health care spending goes to providers. This means that the only way to reduce spending is to pay doctors less, pay nurses less, pay drug companies less, and pay device manufacturers less. This will not happen, and anyone who’s serious about national health care would be insane to try. Why put up an enormous barrier to success, after all? [Emphasis added]

We agree with Kevin on the part we have put in bold.  The only problem is that the part above it is a description of national health care.  It is certain

Sidebar: We often envy writers for their certainty about a variety of things.  The outcome of very few events is certain.  End Sidebar.

that national healthcare will pay doctors less, nurses less, drug companies less, and manufacturers less.  As a small example from the left, there is the Obamacare tax (#10) on medical devices.  The Donald, like many politicians, is upset with drug prices.

Then Kevin explains how it is free:

The one thing we probably could do is get rid of insurance companies, which would save a bit of money—probably about enough to make up for the cost of adding the remaining uninsured to the system. So in the end it comes out even after all.

We did not make that up.  Kevin is saying that moving administration largely from the insurance companies to the government is going to save us money.  Not just a few dollars but enough to add all of the uninsured into insured.  What do you think the probability that the government is more efficient that private enterprise?  To be fair, given the government regulations in health care, the chance is very close to but not exactly zero.

The clowns and jokers seem to be more numerous than ever.  Did MWG really end up in the middle?  How many adjectives or prefix will there need to be to make MWG a conservative? Are you with us?  We have received but not read the other Kevin’s new book.  Perhaps reading that we relieve our funk.  We hope to get around to explaining why George Will’s new book is great but we still feel lonely.