Entries tagged as ‘Politics’
The Wall Street Journal wrote an article yesterday about the austerity measures Ireland has imposed to deal with its burgeoning deficit in the wake of its massive housing bust. Ireland’s current deficit is 12% of GDP, just behind Greece’s 12.7%, and not that far from our 10.6%. So what did Ireland do to address its budget deficit? Cut teacher and police salaries 15%. Reduced civil servant pay. Increased taxes across the board. People are having to skimp and make do as a consequence, but Ireland was also able to issue debt with a yield 150 basis points below Greece’s recent issuance. Ireland did what needed to be done.
Contrast that with the US, which also has yawning deficits, at the federal, state and local levels. Can you imagine what would happen here if a politician suggested cutting police pay by 15%? The police unions would raise a shitstorm of fear about rising crime rates. Politicians would elbow each other out of the way to say who was “toughest on crime.” Hell, the police would probably end up with a raise. I’m not saying that cutting police pay is a panacea; what I’m saying is that spending is going to have to go down, and taxes are going to have to go up. And instead of posturing about being tough on crime, we need to do what is really tough: admit that the party is over and it’s time to cut back. If Ireland can do it, so can we.
Categories: Business · Politics
Tagged: america, deficit, ireland, Politics, spending, taxes
Here is economist Simon Johnson’s take on the news that Goldman Sachs helped Greece hide the overwhelming debt that is currently forcing the European Union to bail out the birthplace of democracy.
Categories: Business · Politics
Tagged: bailout, Business, economics, european union, federal reserve, goldman sachs, greece, Politics
I understand the feeling of the Tea Party that government isn’t responsive to the public, and that government is too big. I even understand, although strongly disagree with, the Tea Party view that government just transfers money from hard working Americans to lazy ones. But as this NY Times article makes clear, there are parts of the Tea Party movement that share the paranoid, New World Order fears which have populated certain right-wing movements for decades. When reading the quotes from some of these people, I find it difficult to conclude anything other than that they are unhinged from reality.
Categories: Politics · Trends
Tagged: GOP, john birch, paranoia, Politics, right wing, tea party
Historian David Kennedy wrote an interesting article in The Atlantic about how President Wilson tried to bridge the realist and idealist camps of American foreign policy by setting up the League of Nations. Kennedy describes how the League failed, but how the UN, the IMF and other international organizations have generally managed to recognize the primacy of sovereign states and acknowledge the power of the United States while making the world “safe for democracy,” in Wilson’s words. The article is a good primer on why even the world’s most powerful nation can benefit from strong international organizations.
Categories: Politics
Tagged: foreign policy, Obama, Politics, un, united nations
Today’s Wall Street Journal had a must read story with an example of why health care costs are out of control, and why a significant overhaul is going to be needed to fix them. In 2007 a major study demonstrated that in most cases, inserting a stent (a $15,000 procedure) to help chest pain was no more effective than using drugs alone. The study laid out the circumstances in which this was the case, and made clear that performing a stress test to determine the cause of the chest pain was a good idea before inserting a stent. The head of the American College of Cardiology called the study a “blockbuster.” Awesome: fewer surgical procedures, cheaper health care, same outcome. Good news, right?
Wrong! The study made no change in the number of stent procedures in the US. Why? Well for one thing, cardiologists make $900 per stenting procedure, which is why the average interventional cardiologist makes $500,000 per year, up 22% over the last decade after adjusting for inflation. As the author of the study put it, “What’s going to continue to drive practice is reimbursement.” But if the only challenge was the greed of doctors (regular Thoughtbasket readers know how I feel about doctors who see their practice as a path to riches), that could be addressed. Insurance companies could just pay less.
But insurance companies face a competitive problem: if one cuts payment for stents, maybe customers will go to another insurance company that doesn’t. Plus, since insurance companies usually mark up the cost of procedures anyway, they often don’t have a great incentive to push down the price doctors charge.
When Washington state tried to use the study to change its Medicaid rates, and wanted additional data, the stent makers and cardiologists in the state (including the cardiologists at the University of Washington…employees of the state!) refused to cooperate. Washington had to give up.
And patients get some blame too: as one cardiologist put it, if your doctor says “let’s try drugs first, and then maybe we’ll stent later,” you are likely to just find a doctor who will stent immediately. Americans tend to expect an immediate fix from their doctors.
So doctors, insurance companies and patients all essentially conspire to have unnecessary treatments that cost about $5 billion per year. That is $5 billion, each year, or 5% of the total cost of the health care bill currently in Congress. If something so simple and so clear is so hard to fix, how do we expect to bring other health care costs down?
Categories: Business · Politics
Tagged: Business, economics, health care, obamacare, Politics
Grover Norquist, founder of Americans for Tax Reform, inventor of the “starve the beast” approach to government, and hater of all things that aren’t middle or upper class, showed in today’s Wall Street Journal why he is so terrible. As he was shoveling snow outside ATR’s headquarters, he said:
“Think about it…a government which can’t plow the streets and can’t fix the potholes wants to tell us how our toilets should flush, what size cars we should drive and whether we should paper or plastic when we buy our groceries.”
Let’s ignore the piss-poor parallelism of his statement, as well as his conflation of local and national government initiatives, because that is mostly stupid, as opposed to mean, to focus on the substance of his remark. Because what he is saying is that since he and his fellow low tax crusaders have starved governments of the revenue needed to perform basic services (eg. plowing snow), government is therefore incompetent, and thus shouldn’t be trusted to do anything. I know, that is the entire modus operandi of starving the beast, but rarely do you get him to say it so clearly and cruelly.
Categories: Business · Politics
Tagged: americans for tax reform, club for growth, GOP, grover norquist, Politics, republicans, ronald reagan, taxes
Because Frank Luntz comes up with catchy, albeit false, lines. He is a master (and I do mean master…you have to respect his talents, even if he uses them in a bad cause) at creating a narrative that appeals to the average American. Read about him here and here.
Categories: Politics
Tagged: frank luntz, GOP, Politics, republicans
Richard Clarke, who was a lead anti-terrorism official in both the Clinton AND Bush administrations, recently wrote a piece in the NY Daily News discussing the current status of our policies and some of Obama’s recent decisions. As you might expect from someone who worked in both Democratic and Republican administrations, Clarke takes a pretty rational approach and tries to cut through all the political noise. The article is worth a read. Check it out here.
Categories: Politics
Tagged: Obama, Politics, richard clarke, terror, terrorism
This is just one example, but of course there are zillions. Richard Shelby, Senator from Alabama, has put a blanket hold on 70 Obama nominees. Not because he has any concerns about those nominees, but because he is pouting that funds haven’t been released to build an FBI explosives center in Alabama and because he thinks the Air Force tanker procurement system isn’t fair to Northrup Grumman, which has facilities in Alabama. So let’s be clear: despite the massive deficit, Senator Shelby wants pork for his district, and he is willing to let all sorts of government agencies go unmanned until he gets his way.
And let me remind you that Alabama has 4.7 million people, or 1.7% of the US population. So one guy, representing 2% of the population, can put big chunks of government on hold until he gets his share of wasteful spending. And then he will give speeches about the importance of fiscal discipline. This is why polls show that Americans no longer respect Congress.
Read the story here, complain on his website here.
Categories: Politics · Trends
Tagged: alabama, congress, Politics, pork, pork barrel spending, republicans, richard shelby, senators
Bad timing for David Rivkin, who used Tuesday’s Wall Street Journal for one of his monthly attacks on some Obama policy. This time it was about the Christmas Day bomber, with Rivkin saying that not immediately sending the bomber into military detention was “an intelligence failure of massive proportions.” Too bad that the very next day, today, the exact same newspaper reported that the Christmas bomber is again talking to the FBI, providing “valuable intelligence.” This also damages the arguments of this guy and this woman. Look, there are valid reasons to say that terrorists should be viewed as wartime combatants rather than criminals. But claiming that we won’t get good information from terrorists held in the civilian legal system is clearly not a valid reason. And there is at least one good reason not to throw them in military brigs: it creates an appearance of the US being at war with Islam, which appearance seems to generate more terrorists. Finally, I would like to note, again, that George W. Bush also tried terrorists in civilian courts. For Republicans to now claim that this approach is terribly weak is to be hypocrites of the worst sort. Which is, I supposed, to be expected from politicians.
Categories: Politics · Uncategorized
Tagged: christmas bomber, islam, politicians, Politics, republicans, terrorism
