MLLG Special Posting – The VA Scandal

By: George Noga – June 3, 2014
        The MLLG blog, usually written far in advance of distribution, has never devoted an entire post to a current, breaking news story. The Veterans Administration (“VA”) scandal is the exception because it is the perfect storm: (1) it is the poster child for public choice economics – a frequent topic of MLLG posts; (2) the VA is a sacred cow beloved by liberals; and (3) the scandal provides a stark preview of ObamaCare. Finally, the VA issue fits MLLG’s forte, placing a complex issue in perspective through fact-based and principled analysis – and all in about 1,000 words.
“The VA is a government jobs program that incidentally provides health care.”
        To be fair, the problems with the VA go way back – preceding the Omar Bradley Commission of 1955-1956. There have been 18 reports warning of the wait time problems just since 2005 – of which 70% occurred during the Obama Administration. Although Obama did not create the problems, his ineptitude and obeisance to public unions raised them to a new level. Also to be fair, the VA is not uniformly dismal and enjoys support among many vets – not altogether unsurprising from an agency that has $154 billion to dispense and which often certifies routine aging problems (heart disease) as service related and certifies maladies of dubious provenance as eligible for tax-free disability pensions.
“The real scandal is that the VA considers a 14 day wait to be very satisfactory. Throughout the private sector, wait times are measured in hours and not in days.”
        The VA problems have nothing to do with money. The VA budget has gone from $49 billion in 2001 to $154 billion in 2014. Just since 2003 the VA budget is up 106%, while the number of vets increased 30%. The government tends to throw money at the problem; but, just as with failing schools, no amount of money can ever fix the problem.
Real Causes of the VA Problems
        The cause of the VA mess is easily and fully explained by pubic choice economics which teaches that people respond to personal (not public) objectives. An illustration from the Soviet Union is instructive. Glass manufacturers in the USSR made windows too thin and they tended to break easily; they did this because they were evaluated based on the number of square feet of glass produced. To fix this problem, the erudite commissars changed the evaluations from square feet to pounds of glass produced. Thereafter, the factories began to produce uber thick windows with limited translucence.
       We can chuckle at the clueless Soviets, but the VA is no different. They were evaluated based on patient wait times and they responded in accordance with public choice theory – they rigged the system for their personal benefit. This is no different in principle from changing the thickness of glass due to different incentives. No one should be surprised. Of course, private sector workers also respond to personal incentives; however, business does a much better job of aligning personal incentives with those of the organization. Hence, it would be rare in the corporate world for endemic problems like those at the VA not to be immediately reported up the chain of command where action would be swift and where the failure to report negative information also would carry swift and strong personal disincentives.

        Following are some other more salient causes of the VA problems, although all are readily explainable by the theories of public choice economics.

  • In some VA clinics physicians see only one-eighth (12.5%) as many patients per day as in private practice. Each day the operating rooms are shut down by 3:00 PM. The VA is essentially a government jobs program that just happens to provide some health care – after patients wait 145 days and provided it is before 3:00 PM.
  • The VA is 70% unionized with over 200,000 unionized workers. Obama and the Democrats put the wellbeing of  unions above veterans. Public sector unions have hijacked the VA for their own aggrandizement.
  • Union work rules and seniority cause serious problems as, inter alia, unions have squelched outsourcing VA patients to reduce the backlog because outsourcing is a direct threat to union jobs.
  • VA scheduling software uses a DOS operating system – found only in museums – and 1990s era computers.
  • As to be expected, waste, fraud and abuse are endemic given the vast amount of funds and no accountability.
  • The wait time (Phoenix) to see a physician was 145 days from when a patient requested an appointment; much longer counting the entire process. The real scandal is that the targeted wait time (considered satisfactory) was 14 days. In much of the private sector, wait time is measured in hours, not days. In the early 1990s Kaiser Permanente had a 55 day wait but changed to same day scheduling. Within a year they reduced the wait time to one day.
Real Solutions to the VA Problems
        The near term future is as predictable as a Kabuki. First, liberals will claim the Shinseki resignation  brings closure to the problem. His resignation was forced not by Republicans but by Democrats up for reelection who desire to make precisely that argument. Second, there will be some short term patient outsourcing but it will end just as soon as the problem fades from view – the public sector unions will see to that. Third, government will throw some more money at the problem and they will claim victory. These raison d’etat actions will succeed in getting the issue off the radar screens of the toothless media watchdogs (and the public) until well after the next election.
“Worst of all, the VA is a precise microcosm and road map for ObamaCare. What is harming 25 million veterans today soon will afflict all 315 million Americans. Some, perhaps many, of us will die while waiting 145 days or more for an appointment.”

        The real solution, dear readers, will never happen. There is little or no raison d’etre to have a separate health care system for veterans; this makes no more sense than having a separate medical system for any other profession or line of work. To the limited extent veterans may need certain highly specialized care (such as for prosthetics), this could be accomplished via a small number of – preferably private – facilities. Care of veterans should be integrated into the civil health care system much the same as Medicare. At the very minimum, all acute care shoud be privatized and voucherized, with the VA maintaining only rehabilitation and long term care facilities. Following are the main takeaways:

  1. There is no logic for a separate VA health care system; it must be completely or mostly integrated into the  private economy – especially the acute care portion.
  2. The VA problems can never (and will never) be fixed because government is incapable of such fixes.
  3. Liberals and Democrats never fix anything – real fixes are not important; all that counts to them are intentions.
  4. Everything is predictable and explainable by reference to public choice economics.
       Worst of all, the VA system is a precise microcosm and road map for ObamaCare. Each and every problem identified in this post will be multiplied in spades for ObamaCare. The disaster that now is preventing veterans from getting care and, in some cases, has killed them, will be inflicted on all 315 million Americans. It is only a matter of time until ObamaCare makes all Americans wait 145 days (and likely more) to get an appointment and many will die waiting.

Product Safety: Government Versus Private Sector

By: George Noga – June 1, 2014
        Who keeps us safe? Surely it must be government without whose oversight private business rapaciously would seek profit without regard to consumer safety. It seems axiomatic that bureaucratic watchdogs are required to set standards, police markets, punish miscreants and look out for the public. After all, government employees are benevolent and dispassionate, whereas private industry is greedy, self interested and profit motivated. So, who do you trust?
“Who do you trust; benevolent bureaucrats or profit-hungry businessmen?”
        There is a 120 year old organization dedicated to product safety; it has 152 laboratories employing over 10,00 people, many of whom are scientists; its sole mission is to protect consumers. This organization has evaluated 90,000 products and bestowed its approval on over 20,000 types of products made by 70,000 different manufacturers. It has conducted 600,000 inspections benefitting 700 million consumers. Of course, I must be referring to the US Consumer Product Safety Commission, the Commerce Department and/or the Federal Trade Commission.
        Actually, the organization I just described is Underwriters Laboratories (“UL”), a privately owned and operated company which no one is forced to use. It thrives solely by dint of its impeccable reputation – because of which it is despised by liberals. Yes, greedy businessmen voluntarily seek the UL certification and, if necessary, go to great lengths to make their products conform to the highest safety standards. In fact, many government regulators (including several states) shamelessly copy the codes and standards established by UL.
        Another private organization held in high esteem by the public is Consumer Reports (“CR”), an independent, non-profit organization whose mission is to empower consumers to protect themselves. Founded 78 years ago it eschews advertising to remain free of all commercial pressure. CR is the most trusted independent testing organization in  the world and has an extensive network of test facilities and scientists. CR’s work has consistently preceded and outshown government, particularly with regard to seat belts, cigarettes, microwave ovens, water supply, child safety seats, kerosene heaters, door locks , lawnmowers and vehicle rollovers. CR is relied upon by 8 million consumers.
“Government standards don’t assure safety and safe products fail to pass.”
        Perhaps readers by this point will concede that UL and CR bring something to the table. But surely government is at the forefront of consumer protection. Wrong! Wrong! Wrong! Government sets standards which are tinctured by politics, often contradictory and come with tens of thousands of pages of esoteric regulations. They tend to stress hard-edged enforcement and create an adversarial atmosphere. Government is concerned with standards – not safety. Products that meet government standards aren’t necessarily safe while completely safe products can fail to meet standards.
         Because government is inherently political, it often harms consumers. A case in point affecting all of us is sugar. Outside the USA soft drinks are made with cane sugar, whereas here they are made with high fructose corn syrup – which tastes worse – much worse. This is true for one reason: Archer Daniels Midland lobbied (think $$$) Congress to pass draconian quotas on sugar imports. Surprise: ADM is a leading producer of corn syrup. In another example of government fecklessness, its touted Energy Star program is a fraud. Government leaves it up to manufacturers to self certify Energy Star compliance. Hmmm – I wonder how that would fly at Underwriters Laboratories?
“Okay so now who do you trust – the CPSC and FTC or UL and CR?”
       Many (particularly the young and liberal) are infatuated with government even though we constantly see where private sector decision making is far superior. Human nature dictates that decisions are reached on the basis of personal risks, rewards and incentives – true in both business and government. Business understands this and does a much better job of aligning business and personal objectives so that the correct decision is reached. Government decision making as informed and explained by public choice economics is: (1) based on personal interests and incentives; (2) short sighted; (3) political; (4) rife with perverse incentives and unintended consequences; (5) misaligned with the public interest; (6) favors groups over individuals; (7) slow to change; and (7) within a perverse culture that never will admit failure.
        Most Americans voluntarily do business with Apple, Disney, Wal-Mart, FedEx, UPS and countless others; they have come to admire the quality, value and customer service these companies display each and every day. Americans also are forced to interact with DMV, IRS, USPS and a myriad of other government agencies. Immediately following Hurricane Katrina, Wal-Mart had trucks  loaded with food and water ready to assist victims; within 24 hours Verizon had 95% of its cell phone service running. Government did nothing. Yet, despite their direct personal experiences, many Americans demonize business and worship government; they believe business creates oppression and government creates prosperity.
        Also despite all evidence to the contrary, many Americans distrust business to make safe products and falsely repose their trust in government. Who really has the consumers’ interests more at heart – a faceless bureaucrat behaving in accordance with the tenets of public choice economics or a businessman who will go to superhuman lengths to protect the integrity and value of his brand? I will choose the businessman every time because I know his interests, incentives (and disincentives) and decisions are much more closely aligned with my safety than that of the government puke.

Why Government is Inherently Evil

By: George Noga – May 24, 2014
       James Madison in Federalist 51 famously wrote: “In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself.”  More recently Milton Friedman put it thusly: “How can we keep the government we created (primarily to protect our freedom) from becoming a Frankenstein that will destroy the very freedom we established it to protect?” Very few realize how rare, delicate and fragile are liberty and freedom in the entire history of human experience. Of the estimated 110 billion humans who have ever lived, fewer than 1% have enjoyed liberty.
“Over 99% of humanity has lived only in tyranny and repression.”
       The first step in protecting liberty is awareness of just how venal are all forms of power even the lowest. Let’s begin by looking at fraternities, homeowners associations and country clubs. In my college fraternity, elections for officers were corrupted; once elected few voluntarily relinquished power; elections for fraternity sweetheart were fixed; and those in power stole money – all this from a group of brothers.
       Homeowners associations are a microcosm of government. Generally, the wrong people run for office and, once elected, abuse their power and transmogrify into power-hungry wannabe dictators. Even a small group of neighbors in the same socio-economic group cannot govern collegially. I once belonged to a club that had a committee for selecting the wines to be served in its restaurants. The committee became as permanent as the Soviet Politburo; new members were precluded from joining; and they instituted frequent parties for themselves to taste new wines. They, of course, needed food to go along with the wine tasting and they expected all this extravagance to be paid by the club. Bottom line: all power corrupts; it is endemic in all organizations beginning with the most basic. It is endemic because it is an inextricable and immutable part of the human condition.
“A government’s maleficence increases exponentially with its size and power.”
       The bigger a government, the more corrupt. Local governments in my area have raised corruption to an art form. They find myriad ways to benefit from the public weal, albeit likely without technically violating the law. The schools are abysmal and dominated by (also corrupt) public employee unions. My state government is incapable of fixing a long running property insurance fiasco that threatens to bankrupt it. Our federal government (Amtrak) sells hamburgers for $9.50 to a captive audience and incredibly loses $6.50 each. Not to worry: they will make it up in volume. As to be expected, international organizations are the worst. The UN engages in child rape in Africa and the Nobel Committee admittedly awarded peace prizes solely for vindictiveness to punish Reagan and Bush.
Four Keys to Better Government

        Some level of government has proven to be necessary to protect us from outside threats, domestic violence and to enforce contracts and property rights. We face the same dilemma as Madison and Friedman: how do we cede government a legal monoply on the use of force while simultaneously controlling it and making sure it protects (rather than destroys) our liberty?  Following are universal truths constant throughout time and space and applicable to all governments:

  1. The first step is understanding and internalizing the truth that power corrupts. Understand that government is inherently evil and requires eternal vigilance to keep it inside its constitutional box.
  2. Because the evil in government is inherent (embedded in human nature), it can’t be eliminated or reformed. Part of the evil manifests itself in widespread waste, fraud and abuse – which also never can be exterminated.
  3. Government maleficence cannot be eliminated, but it can be reduced. The only way is to shrink government, ipso facto creating less evil along with less of its miscegenistic stepchildren: waste, fraud and abuse.
  4. The only way to make government smaller is to take away its money; the less money it has, the less harm it can perpetrate. Nothing else will ever work.
       Upon accepting the Nobel Prize in economics, Friedrich Hayek said: “To act on the belief that we possess the knowledge and the power to shape the processes of society to our liking is likely to make us do much harm. . . The recognition of the insuperable limits of (man’s) knowledge ought indeed teach the student of society a lesson of humility which should guard him against becoming an accomplice in men’s fatal striving to control society – a striving which makes him not only a tyrant over his fellows, but which may well make him the destroyer of a civilization. “

Fukushima and the Risks of Nuclear Power

By: George Noga – May 16, 2014
        Following the Fukushima accident 3 years ago, Japan shut all its 54 nuclear reactors although, recently and very quietly, they have restarted a few. Germany pledged to shut down all its reactors within 8 years and some utilities in the USA are under pressure to close reactors. Many countries, particularly in Europe, have vowed never to build new nuclear plants. All this was in response to an accident in which no one died due to radiation.
        Let’s recap the major nuclear power plant accidents throughout history. Three Mile Island (1979) resulted in severe damage to the core but there were no fatalities. Chernobyl (1986) was by far the worst accident; it resulted from a deeply flawed reactor design that never would have been built anywhere outside the former Soviet Union. Despite everything going wrong that possibly could go wrong at Chernobyl, the only known fatalities 28 years later are about 50 highly exposed rescue workers (5% of the 1,000 thusly exposed) and fewer than 10 thyroid cancer deaths. A UN study estimated thousands of future cancer fatalities; however, that represents only a 1% increase in the normal amount of cancer deaths in that population over the relevant time period and is impossible to measure.
“More people died at Chappaquiddick than at Three Mile
Island and Fukushima combined (from radiation).”
       In 70 years with hundreds of mostly old reactors in place there have been fewer than 60 deaths due to radiation and all in the dysfunctional USSR. Why therefore was there such a dramatic reaction to Fukushima? There are 20 coal mining deaths each year in the USA and hundreds involving natural gas. However, we are accustomed to these and they don’t panic us. Each year 100 people die from both lightning and bee stings. A natural gas accident at a Texas school (1937) killed 425 children, yet there was no movement to ban natural gas following that tragedy.
Evidence Shows Higher Levels of Radiation are Beneficial

        Everyone knows too much radiation can kill. However, most people take this factoid and extrapolate that therefore even small doses can be harmful. Consider the following facts:

  • Highly radioactive cobalt accidentally was mixed into a batch of steel in Taiwan in the 1980s and used to build apartments housing 10,000 people; it delivered 30 times normal radiation. When the error was discovered 15 years later, the cancer rate of the residents was 97% lower and birth defects 94% lower than the general population – they were, in effect, immunized against cancer. The Fukushima evacuation zone had 10 times less radiation (equal to a few CAT scans) than the Taiwan apartments.
  •  The Rocky Mountain plateau (Denver area) has 10 times the background radiation of the Mississippi Valley yet has far lower cancer rates. There are areas in the USA with background radiation 100 times higher than the forbidden zone at Fukushima. Some scientists believe we have too little radiation for optimum health.
  • The Atomic Bomb Disease Institute of Nagasaki University studied 120,000 people who received low doses of radiation and compared them with unexposed Japanese. Conclusion: low doses of radiation increased the lifespan of atom-bomb survivors.
Nuclear is the Most Environmentally Friendly Energy
        What makes nuclear energy so attractive is its power density. Biofuels are low in density. If  the USA replaced just 10% of its oil consumption with switchgrass, it would require 37 million acres of land – about the size of Illinois. The power density (energy derived from a given volume or mass) of biofuels is a small fraction of a watt per square meter (“SM”). Wind turbines have a power density of 1 watt per SM. A small natural gas well delivers 30 watts per SM. Nuclear energy generates over 2,000 watts per SM. To get the same energy as one nuclear plant would require 800 square miles of wind turbines – about the size of Rhode Island.
       Nor is storage of nuclear waste a monumental issue. The USA to date has produced 60,000 tons of waste – which could be stored (to a height of 20 feet) in a building the size of a football field. France, which produces 80% of its electricity via nuclear, stores all its high level waste in a single building the size of as soccer field.

       The present perception and public policy about nuclear energy reflects panic rather than facts. For example, the (“ICRP”) International Commission on Radiological Protection (yes there really is such a thing) recommends an area be evacuated whenever the excess dose of radiation exceeds .1 rem per year. This ICRP standard would require the immediate evacuation of Denver. In many designated radiation hot spots in Japan (near Fukushima) the radiation level was much lower than in Denver – yet people panicked and were evacuated. More people died in the ensuing evacuation than in all the nuclear accidents in human history.
       Aversion to nuclear energy is based on panic, misinformation, ersatz environmentalism and political correctness. In 70 years of nuclear energy, deaths from radiation have been nearly nonexistent and far less than coal and natural gas deaths which continue to this day – not to mention lightning and bee stings. Future generations of advanced reactors would be even safer. And no other form of energy is remotely as friendly to our environment!

Liberalism is for the Birds . . .

Liberalism is for the Birds . . . 
Except When It Doesn’t Suit Their Purpose 
By: George Noga – May 8, 2014
       Liberals (and their sycophant media) go ga-ga over birds whenever it suits their purpose. During the BP oil spill we were saturated with images of a pelican dripping with oil, only later to learn the photo had nothing to do with BP. One year after the BP spill, credible estimates of bird deaths varied from a low of 1,200 to a high of 6,000; the Audubon Society estimate was 2,300. Nevertheless, liberals used the birds to limit or to stop new offshore drilling. Similarly, a 2013 oil pipeline rupture in Arkansas was used by activists as a cause celebre to stop new pipelines even though the verified toll was only a handful of ducks. Birds are being used as a major argument for stopping the Keystone XL Pipeline. In fact, saving birds is an argument progressives use to oppose every fossil fuel project from drilling to pipelines to fracking.
       Today, green activists are invoking the Endangered Species Act to list the lesser prairie chicken and sage grouse as threatened species. These birds are found in 11 western states where the federal government owns most of the land – 48% of California, 62% of Idaho and 82% of Nevada. Hold your breath: activists are trying to list another 757 species between now and 2018. Never mind the 757 other species; the prairie chicken and sage grouse alone are enough to stop drilling on federal land. The restrictions are so severe, it would also effectively stop drilling on private land. To be clear about this, liberals could use the prairie chicken and sage grouse to stop all drilling in 11 western states.
The Mathematics of the US Bird Population
       This post uses many numbers about bird deaths; therefore, some perspective about bird population would be helpful. Every year in the USA there are 10 billion new birds hatched. Fewer than 1,000 birds are killed each year as a result of fossil fuel activities, whereas 500,000 are killed in wind turbines including bald eagles, and golden eagles. Thus, wind energy kills 50,000% more birds than fossil fuel. Collisions with windows kill about 500 million birds (midpoint estimate) – 100,000 in New York City alone. Cats kill another 500 million annually. Cars, power lines and habitat loss kill another 1.5 billion or so. Every day in the USA nearly 15 million birds meet their fate. The best way to protect birds would be to ban cats. In any event, these numbers provide perspective; fossil fuels kill .0000001% of birds versus cats’  5.0%.
 Liberal Hypocrisy About Birds
       Okay, so liberals pretend to be birds’ best friend when it suits their purpose; what about when it doesn’t fit their agenda? I already pointed out how wind turbines kill 50,000% more birds than fossil fuels. Let’s expose several other liberal hypocrisies about birds.
       The $2+ billion Ivanpah solar project recently opened in the California desert; its 350,000 mirrors span 5 square miles. It was financed by federal tax credits and cost 400% more than a gas fired plant; the electricity it produces costs twice as much. The Ivanpah project is scorching birds that fly overhead with its 1,000 degree heat. The massive death toll has included peregrine falcons and great hawks. So far, nary a peep from environmentalists.

  • The wind industry enjoys de facto permission to violate the Migratory Bird Treaty (protecting 1,000 species) and the Bald and Golden Eagle Protection Act. The Interior Department has brought one token enforcement action against wind energy but it aggressively pursued criminal cases against the oil and gas industry in North Dakota for killing a single bird – a Say’s Phoebe. At California’s Altamonte wind project 70 golden eagles are killed annually.
  • The Interior Department granted wind farms 30-year take permits to kill eagles. The government expects to receive 15-20 applications for the new eagle kill permits. Wind and solar farms and hydroelectric facilities often destroy the ecosystem but they get a pass – essentially because they are politically correct. Get this: the liberal argument is that climate change ultimately will kill even more eagles; therefore, we have to kill eagles now in order to save them.
  • Since Obama took office 17 major solar projects have been approved on public land and received expedited approval. Not one liberal or environmental group protested this rush to build, even though these groups moved heaven and earth to protect snail darters, delta smelts and spotted owls. However, these same groups are willing to sacrifice bighorn sheep, desert tortoises and other critters on the altar of the green energy gods.
      Wind energy soaks up an obscene amount of tax dollars. It raises the cost of energy – 40% since 2003, rips apart rural communities, despoils views, kills eagles and falcons and creates noise for miles. It pollutes pristine lakes in Mongolia (where neodymium is mined and refined) with toxic radioactive tailings. The average wind turbine requires a ton of neodymium. Despite all this, wind energy accounts for less than one half percent of all energy.
“We have to kill the eagles in order to save them.”
       Above all, this documents the utter bankruptcy and depravity of liberalism. Liberals shed crocodile tears for birds on cue but are ready to throw hundreds of eagles each year into the wind turbines and scorch them to death while flying over solar farms all because they deem it politically correct. Liberals lie about birds because liberalism is all based on lies.

Reflections: Yesterday Versus Today-Has America Become a Pusillanimous Nation?

By: George Noga – May 1, 2014
      Many decades ago it was commonplace for us kids (with parents’ consent) to run behind mosquito foggers spraying DDT to inhale the aromatic fumes – same when dispensing gasoline. We ate raw hamburger, rode bicycles and motor scooters without helmets, played baseball sans helmets and with real spikes. There were no warning labels on anything. We owned BB guns, pellet guns and .22 rifles and carried them everywhere day and night in residential neighborhoods. Both boys and girls hitchhiked day and night; there were no seat belts, shoulder harnesses or airbags.
        We walked miles to school in first grade without crossing guards; we were not afraid of strangers. We kept score in all games and only winners received awards. There was only one valedictorian. There were no safety caps and we eagerly consumed candy cigarettes. Homes and cars rarely were locked. Only one kid of the hundreds I knew at school, baseball and scouting was overweight. We played tackle football without protection. We were not shielded from adversity and were expected to overcome it by our own devices. We were paid to babysit as early as age 11.
        We operated circular saws, jigsaws and planers without supervision or goggles. Halloween was entirely on our own including entering strangers’ houses. We were left to ourselves all day and evening to roam a wide area without parental supervision or knowledge of our whereabouts. We solved all our own problems – sometimes by fighting. I had a paper route at age 12. The papers were delivered at 4:00 AM when I got myself out of bed and they had to be delivered before 6:00 AM. Inevitably there were many times when it would rain, sleet, snow and be bitter cold. My parents never once offered to drive me and asking them to do so never crossed my  mind.
        In sixth grade, a classmate’s (Jimmy) father was killed in a plane crash. When Jimmy returned to school all of us were uncomfortable as no one knew how to act. No teacher or anyone else told us how to respond or what to say; that misanthropic creation, grief counselors, thankfully did not yet exist. Nevertheless, we all knew intuitively that saying nothing was inappropriate and not an option. I did the best I could however lame it may have been.
Today in America
        There is a war on childhood in America; age 10 is the new age 2. Many school districts don’t permit children to get off a school bus unless there is a guardian waiting to walk them home – even if home is a few blocks away. Libraries don’t allow children under 12 to be unaccompanied. Parents are advised not to let children under 14 blow up a balloon. Parks and schools everywhere have removed see-saws, merry-go-rounds and monkey bars. Day care centers have been ordered by OSHA to saw off tree branches below 8 feet to prevent kids climbing trees.
       Recently Amtrak raised the age for travel by unaccompanied minors from 8 to 13; moreover, kids ages 13-15 cannot travel unaccompanied unless they meet a lengthy list of restrictive conditions. In reality, travelling alone is not feasible until age 16. Before Amtrak’s policy change, kids 8 could travel unaccompanied and a 15 year old could serve as a guardian for even younger kids. Now, the 15 year old cannot even travel alone. Meanwhile in Japan, eight year olds travel unaccompanied without restriction all the time and without incident.
       Recently a school bus had an emergency evacuation because the driver saw one peanut on the floor. No one on the bus was known to have a peanut allergy. Peanuts are disappearing from many ballparks and elsewhere. Schools now provide grief counselors for the death of a pet. It is becoming common for schools to have multiple (up to 70) valedictorians – to avoid hurt feelings. Need I mention grade inflation? Even nursery schools now routinely have graduation ceremonies replete with caps and gowns. Our national pusillanimity extends to pets. Some animal shelters won’t permit dog adoptions unless the owners have a fenced in yard and pledge to accompany the dog whenever outside the yard. There was time in America when dogs guarded people, not the other way around.
        The marketplace now caters to parental fears by selling leashes for kids and alarms that sound if the kid wanders 10 feet away. New GPS devices for kids are coming on the market. One company sells a “Piggyback Rider“, a backpack for kids up to age 7 and 60 pounds – nearly old enough to ride a train in Japan. Laws about  babysitting have changed. In Illinois a child under 14 requires a babysitter, while the minimum age for babysitting escalates. In kindergarten 20% of kids are obese and adult diabetes appears as young as age 3.  Many parents instruct schools not to allow their children outdoor play; they are to be kept indoors to read a book instead. The Consumer Product Safety Commission decided to rid all US houses of that terror – window blinds with cords – because of a handful of accidents annually. Next time you see a new window blind, read the safety label; you won’t believe what you see.

    Inevitably, this pusillanimity affects our policies and actions as a nation. Could this be why we have become appeasers in Crimea, Ukraine, Syria, Iran and North Korea? Appeasement is the sickness of the will of successful people. Has the thirst for prosperity, material well being, comfort and, above all – safety at any price – led to passivity, caution and retreat? The price of cowardice is always more evil. Perhaps this is to be expected from a nation whose president has stated: “If I had a son, I’d have to think long and hard before I’d let him play football.

Inequality in America – Part 2

By George Noga – April 23, 2014
        Our post of February 7, 2014 addressed income inequality in America between rich and poor. Since then we have been bombarded by the Obama administration and its sycophant media about income inequality between men and women. Therefore, we now focus on gender inequality and, more importantly, on who is creating inequality in America.

Income Inequality Between Men and Women

       Firstoff, this is an old issue. For over 30 years, Democrats have waived the bloody shirt of gender inequality. They resurrect the issue whenever they feel it necessary. It has been revived now for one, and only one, reason. Polls show women disinterested and less likely to vote in November. Liberals cynically believe they can get more women to vote by patronizing them with warmed over lies. That shows what they really think of women. To their consternation, it now looks like the issue is backfiring on them as more information comes to light.
       Obama asserts women earn only 77% of what men earn. That’s roughly analogous to saying women are only 77% as strong as men without making any adjustments for height, weight or physical condition, i.e. it is meaningless. It is well known and long understood that when making appropriate adjustments for: (1) level of education; (2) type of degree (engineering vs. sociology); (3) experience; (4) hours worked; and (5) level of danger (lumberjack vs. teacher), women earn on a par (96%) with men. Moreover, deaths in the workplace are 92% men.
“It is impossible to be too cynical about any claims made by Obama; he hasabsolutely no shame or compunction about lying whenever it suits him.”
       The issue  now is backfiring on Obama. It was revealed female White House staffers earn only 88% of men. Not one Democratic senator has a female chief of staff or head of communications, whereas Republican senators have several. If Obama were correct, private businesses could hire all female workforces and gain a 23% payroll cost advantage over their competitors. That this is not happening speaks volumes about the veracity of Obama’s claims. It is impossible to be too cynical about any claims made by Obama; he has absolutely no shame or compunction about lying whenever it suits him.

The Top 10 Real Sources of Income Inequality

       To the extent income inequality is increasing, the cause is none other than Obama himself. Following are the top 10 Obama policies that are making the poor even poorer.

  1. Tobacco tax increases: Taxes on tobacco, especially in states with liberal governance, have vastly increased. Smokers are in the lowest income quintiles and they have been savaged by effete progressive ideas.
  2. Opposition to free trade: The underclass benefits more than any other group from free trade. Obama, in obeisance to labor unions, has put the kibosh on new trade agreements despite giving it lip service.
  3. Higher taxes: A variety of new and increased taxes (including Obamacare) harms the poorest cohorts. Even taxes on business harm the poor by discouraging investment, lowering productivity and stunting economic growth.
  4. Unemployment: Employment is far from where it should be; this is the worst economic recovery of all time – thanks to Obama no-growth policies. The percentage of Americans working is the lowest since 1978.
  5. Minimum wage hike: Raising the minimum wage causes unemployment among the poor. If you increase the cost of anything (labor), you always get less of it – a fundamental economic truism.
  6. Energy policy: Energy takes 25% of the income of a poor household but only 10% of a high income household. The average cost of a kilowatt hour is up 39% since 2003 – the vast majority under Obama. Need I mention Keystone?
  7. Monetary policy: Due to Obama’s horrendous spending, debt and deficits, interest rates are kept low, savaging the savings of poor elderly Americans. The little guy can get only a fraction of 1% on his money instead of the 5% that should be normal. If a retired couple has only $25,000 in savings, this costs them $100 per month.
  8. Tepid economic growth: Hyper regulation and enormous uncertainty about future taxes and regulations have cast a pall over economic growth. Companies are not expanding or hiring – again harming the poorest among us.
  9. Obamacare: Health care costs are rising along with taxes to fund it. The poorest Americans bear the brunt – not just economically – but due to doctor shortages, rationing and death panels. The legions of 49ers and 29ers are growing!
  10. School choice/charters: Teachers union wars against choice and charters condemn the poor to inferior educations and hence much lower paying jobs. They are killing poor children educationally solely to pay back unions.
       The level of hype and downright lies about inequality is unprecedented. The liberals are circling the wagons. Believe it or not, we are being told that (non existent) manmade global warming now causes greater inequality. The IMF is putting income inequality on the top of its agenda for aid to poor countries. It is good to recall the words of Milton Friedman: “A society that puts equality of outcome ahead of freedom will end up with neither equality nor freedom“. The next time you hear about inequality in America, remember that the blame lies at the foot of one Barack Hussein Obama.

Titanic Myths Debunked

Sinking Was 102 Years Ago Today
By George Noga – April 15, 2014
       Although Titanic sank 102 years ago today, many myths survive intact. Everyone knows the impact with the iceberg sank the ship, but that was not the cause of the death of 1,513 souls. Books and movies (including the DiCaprio film) lay blame on the greedy capitalism of White Star Lines for not having enough life boats. This is myth. Another myth is that first class passengers received preferential treatment resulting in a much higher survival rate than for lower class passengers. Finally, was male aggression truly responsible for throwing women and children under the bus – – err, boat?

Myth #1: Capitalism and Greed Caused the Loss of Life

       No one died when Titanic hit the iceberg; the deaths occurred much later when the ship sank. Historically, most have faulted White Star Lines for not having enough lifeboats – either because of their added cost or objections to their aesthetics. These accounts are either lazy, ignorant, dishonest or politically correct. The real cause was inept (is there another kind) government regulation by the British Board of Trade (“BOT”) that regulated shipping. The designer (Andrews), the builder (Carlisle) and White Star (Ismay) all deferred  to the BOT on the decision about the number of lifeboats. No one questioned the government; after all, they were the unchallenged responsible authority.

         The BOT had not updated its regulations in 20 years. Its regulations were promulgated at a time when 10,000 metric tonnes was the norm and 20 lifeboats were adequate. That Titanic was 46,328 tonnes did not seem to occur to government. Nothing much has changed in 102 years regarding government regulation – except that we perhaps understand its pathology much better – thanks in part to public choice economics which teaches us:

  • Once government becomes involved, common sense and personal responsibility disappear and everything focuses strictly on regulatory compliance.
  • Regulated entities (White Star) as well as the ship’s designer and builder are conditioned to comply with the diktats of rules and regulations and not with their goal or intent.
  • Government bureaucrats are lazy and inept. They prefer new regulations to updating existing ones. There is little glamour or political benefit in simply maintaining existing regulations.

Myth #2: First Class Passengers were accorded Preferential Treatment

       Most Titanic stories flog the class stratification issue; this is a myth as well. In fact, the difference between first class and third class survival rates was slight. Anyone with basic numeration skills and a modicum of analytic ability can quickly cut through the numbers. The relevant fact is that 74% of women survived and only 20% of men. However, 44% of first class passengers were women compared to 23% for third class. After making the appropriate adjustment to account for that difference, it is incandescently obvious the variation in first versus third class survival rates virtually disappears.
         Moreover, the slight remaining difference in class survival rates is attributable to third class passengers’ greater reluctance to leave the ship, to part with their baggage and difficulty related to their location aboard ship. When third class passengers reached the boat deck they received the same treatment as anyone else.

Myth #3: Male Aggression was a Key Factor in Male Survival

      The number of men who survived via the lifeboats usually is portrayed as evidence of male aggression and as coming at the expense of women and children. But the facts are stubborn. There was enough lifeboat capacity to save all women, children and 550 men. Remember, there were far more men than women on board. Indeed, if the crew had loaded one man for each woman and child, all women and children could have been saved. Furthermore, this would have resulted in loading the boats more rapidly, reducing the fear level, keeping families together and ultimately saving many more lives. Far from being villainous, male behavior resulted in far fewer men surviving than should have been the case.

Lessons of Titanic

       The Titanic’s loss of life was, first and foremost, a failure of government, not capitalism. It is far easier to place blame on prominent individuals such as the ship’s designer, builder and owner rather than on an amorphous, faceless gaggle of bureaucrats. The enduring lesson of Titanic, just as in most disasters, is not to place faith in government.
       Another lesson is not to repose trust in the media; 102 years later they still get the story all wrong. They continue to portray the loss of life as caused by capitalism, greed and hubris. They also continue to shamelessly flog class warfare and to bash males – all politically correct story lines.
       The death toll of 1,513 was tragic. Today however, government is creating disasters affecting hundreds of millions and perhaps billions of people. Government run amok is bankrupting our nation of 313 million and also much of Europe. Government fecklessness has placed the entire world at grave risk by appeasing aggression by Russia, Syria and Iran and encouraging tyrants everywhere. As always, the state sycophant media is  government’s handmaiden. The only thing that has changed in 102 years is that the grave harm government causes now affects exponentially more of us.

Obama Agonistes: Boneheaded Economics

By: George Noga – Substantially Updated April 8, 2014
 
        Milton Friedman once asked a foreign government official why workers building a canal were using shovels instead of excavating equipment. The official proudly responded “to create more jobs of course”. Friedman’s classic retort was: “Then why not use spoons instead of shovels?” Most who hear this story viscerally comprehend the foolishness of the government official – except President Obama. He and his minions have said things every bit as wacky as saving jobs with shovels instead of bulldozers.
“Obama’s solipsism and narcissism shield him from his economic illiteracy
and give him delusions of adequacy. He is not unlike a blissfully ignorant child incessantly toying with the economic dials that control the real world.”
        Obama linked technology to job losses: “A lot of businesses have learned to become much more efficient with a lot fewer workers. . . . when you go to a bank and use an ATM machine you don’t go to a bank teller, or you go to the airport and you’re using a kiosk instead of checking in at the gate.” Even Economics 101 students  recognize ATMs and kiosks as progress, as greater productivity, as the sine qua non of a higher standard of living and as an unalloyed blessing. Becoming more efficient and productive, doing more with less, produces the cornucopia of goods and services that makes America the envy of the planet. That our president misunderstands this reinforces the image of a child fiddling with the economic dials.
        Obama, Biden and Pelosi have touted unemployment benefits as an economic panacea. They all have stated that unemployment benefits create jobs faster than any other initiative and they have the double benefit of putting money in the pockets of the jobless who then spend the money on consumption to create yet more jobs. Please Mr. President, can we have even higher unemployment so that we can create even more jobs? As far back as Adam Smith (1776) it was well understood that production, not consumption, is what makes us rich.
       The USSR had enormous pent-up consumption but there were no goods to buy. John Stuart Mill debunked the consumption myth best: “the man who steals money from a shop, provided he expends it all again in the same shop, is a benefactor to the tradesman whom he robs, and that the same operation, repeated sufficiently often, would make the tradesman a fortune.” Obama has said that government created jobs will lead to stronger economic growth. He again has it bass-ackwards; economic growth must precede job creation. Obama is ignorant of fundamental economic truths known for at least 250 years. It is hard to dispell the image of a toddler in diapers playing at economics. A toddler is shielded by his age and lack of education; Obama is shielded by his solipsism, narcissism and an equally ignorant sycophant media.
       Obama is harming the very people he passionately asserts he wants to protect, i.e. the downtrodden. He claims his spending binge is for social welfare and health care. Yet, he is condemning the current and future underclass to a much more hardscrabble life. America’s GDP growth already has slowed to European levels and over time the poorer among us will be infinitely worse off than they would have been with higher economic growth. Of course by then few will care or remember – no less understand, who was responsible.
“Obama’s failure to grasp the depth of his economic ignorance is wholly consistent with that of a solipsist and narcissistwho believes only the self exists and who is preoccupied with only his feelings and is egotistically self-absorbed.”
        Obama Agonistes’ slavish ideological dogma and economic illiteracy are leading us all into a netherworld. The president’s people gleefully depict political adversaries throwing grandma over a cliff. Obama is throwing all of us (including his supporters) over the cliff – and all for a failed socialist chimera. Obama’s failure to grasp the depth of his economic ignorance is consistent with the behavior of a solipsist and a narcissist who believes only the self exists, who is preoccupied with only his feelings and who is egotistically self-absorbed.

ObamaCare’s April Fool – Only It’s No Joke

By: George Noga – April 1, 2014
        You believe you know all the ObamaCare horror stories? You know the lies about keeping your doctor and health plan; you know about the millions of cancelled plans and  the illegal extensions. You know about the website disaster and the much higher premiums, deductibles and copays. You know about all the political payoffs to labor unions and about the 29ers and 49ers.. You know high-end medical facilities such as Mayo are now off limits. You know you have much fewer choices of physicians and hospitals. You know about the coming doctor shortage, rationing and death panels.
        If you know all that, you still don’t know the biggest April Fool of them all; in fact, you don’t know either of the two biggest ObamaCare surprises. In the run up to the law we incessantly heard about the 40+ million uninsured and how disgraceful this was for Amrica. Obama said: “I’m not going to walk away from 40 million Americans who can get health insurance for the first time.” ObamaCare was sold primarily so that the uninsured could get coverage. The dirty secret is ObamaCare never was about providing coverage to the uninsured; instead, it was about changing Americans’ private insurance plans into government plans.
“ObamaCare’s goal was not to insure the uninsured but to shift Americans from owning private insurance plans into becoming dependent on government plans.”
       The numbers bear this out. Pre ObamaCare, the 48 million uninsured number always was a known red herring. From 10-15 million already were eligible for public plans; 9-12 million were illegal aliens; 17-29 million earned enough to buy insurance but freely chose not to; and 4 million were without insurance only temporarily. Bottom line: when using reasonable midpoint estimates for the above data, only 5 to 10 million Americans were involuntarily without health insurance. Now, let’s fast forward to 2014 and ObamaCare and see what has changed.
  • Only about 10% who bought through exchanges were previously uninsured.
  • Up to 80% who signed up with exchanges shifted from private plans to public subsidies.
  • 60% of those who signed up for Medicaid were already eligible.
  • Illegal aliens remain ineligible for ObamaCare just as before its passage.
  • The 17-29 million Americans (mostly young males) who previously chose not to buy insurance are less likely to buy now that they are required to subsidize everyone else.
        When all the data become known, we still will have 40 million uninsured Americans – about the same number as before ObamaCare. This is not an accident and was well understood beforehand. ObamaCare never was about insuring the uninsured, it was about shifting private insurance to government programs. There you have it; you once again have been hoodwinked and bamboozled. This April Fool is no joke and it is on you. Where are all my liberal friends who were bleating about helping the poor and uninsured? When the piper plays; they dance.
“ObamaCare is dividing Americans into 3 distinct cohorts. One-third will be dependent on Medicaid (ugh!); the middle cohort will have fewer and much less desirable choices; the top group will enjoy top-tier concierge services.”
        I wrote supra there is a second surprise, i.e. ObamaCare is carving up Americans into three distinct segments each of which will receive widely different care. The bottom third will be on Medicaid and dependent on government programs with little choice of doctor or hospital; they will receive substandard and indifferent care. The middle cohort of Americans will muddle through with costly plans that exclude the best physicians, hospitals and facilities; they will experience lengthy waits and rationing. Surprise: the top 10% to 20% of Americans will receive concierge medical care and continue to have the best of everything America offers.
     ObamaCare is a naked lie. It was sold to us as compassionate to insure more Americans; it doesn’t accomplish that because there weren’t but 5-10 million involuntarily uninsured Americans to begin with. Instead, its goal is to move everyone into government care and in the process it cruelly divides us into three groups – each with vastly different standards of  care.