Do you want to hedge the risk that government will overstep?

For once I agree 100% with Sebastian Mallaby when he’s discussing economics and finance. Consider:

Modern societies worship innovation. When tech wizards get rich by founding Facebook or YouTube, people tend to celebrate. But this healthy admiration for success is subject to exceptions. When a different species of tech wizard gets rich by founding a hedge fund, the reaction is ambivalent — even though hedge funds contribute to the success of the economy as surely as tech firms.

Last week was fairly typical. The European Central Bank called for new regulation of hedge funds, including American ones. Germany’s government declared that hedge fund oversight would be on the agenda when it hosts next year’s Group of Eight meetings. Not to be outdone, the U.S. Securities and Exchange Commission proposed a rule that would bar all but the wealthiest 1.3 percent of households from investing in these demon vehicles.

How to explain all this suspicion? Hedge funds are simply pools of money whose managers are paid according to performance. This system of rewards is no more sinister than the patent system, which spurs inventors with the prospect of fabulous profits. Like intellectual property laws, hedge fund performance fees have created some impressive fortunes. Like intellectual property laws, they have inspired innovation, too.

His analysis is presented well. With over-intrusive government meddling in personal investing decisions, the government might as well mandate a “mutual funds only” policy for individuals. It would be just as rational, which is to say not at all. Oversight is important, as the history of finance and business in America shows, but I can just as easily lose all of my money in my business or in Las Vegas as I can by making investment decisions. Full disclosure, yes. Paternalistic protection, no.

The Law Is Subservient to Agendas

Can we please get to a point where we’re not battling over which side of the political spectrum has “control” over the courts?

A growing list of vacancies on the federal appeals court in Richmond is heightening concern among Republicans that one of the nation’s most conservative and influential courts could soon come under moderate or even liberal control, Republicans and legal scholars say.

Jan LaRue, chief counsel for Concerned Women for America, said she and other conservatives are disappointed with Bush and Senate Republicans for not pushing harder to fill the vacancies before losing control of the Senate.

“Now all they’ve done is managed to kick the can down the road, and we’ve lost the majority,” said LaRue, whose group advocates for conservative jurists. “That circuit in the wrong hands could certainly move toward the center-left.”

Whoever is doing the nominating and whoever is doing the confirming should be irrelevant. Babbling against “activist judges” to gain the opportunity to appoint activist judges is shameful. I’d rather have a judge who believes in individual rights. Call that a bias, but the Constitution says what it says. Enough with the partisanship.

Video games are not reality.

I don’t talk too much about my personal life on Rolling Doughnut. Part of that is to preserve some anonymity, and part of it is because, despite being a blogger, I understand that my life is only interesting to me and those close to me. You probably don’t care to hear that I’ll punish a few members of the Locust Horde in Gears of War tonight. Sometimes, though, reality interferes to push my life into something more universal and relevant.

On Monday, my brother joined the Marines. He should be finishing his first semester at college, but for reasons I don’t care to share here, he’s now in boot camp. He wants to fight in Iraq, for all the wrong reasons. He’s 18 and thinks he has the world figured out, as most people do at that age. Nothing will stop him. Where he is fearless in thinking that battlefield death is noble, I’m scared to death thinking that the next time I see him will be at his funeral. He seems strangely content, even anticipatory, of the idea. I am not.

I turned against the war in Iraq a long time ago. As I said, I was very naive in believing that we could build a nation. For that I carry my share of the blame. But I do not believe I was out of line to trust the Bush administration to run the war competently once it decided to engage. It has failed to do so at every step. This is unforgivable, yet, President Bush appears prepared to send more men and women to fight a war that he is not serious about winning. He is a shameful, little man.

I’ve accepted that my brother will be sent to Iraq. Despite his high entrance exam score, he chose to join the infantry. He does not understand that he is a number to the military, a troop level increase. A body. To me, he is a human being, with flaws, strengths, misconceptions, and honor. I respect his right to make this decision, but I also want to meet his children one day. I wonder if President Bush cares more about that or his political legacy.

I don’t like the conclusion I’ve reached.

You’d Shake Your Canteen and Walk Away

I’m not going to hammer away at the details of New Jersey’s new civil unions for same-sex couples. From what I understand, the basics seem to satisfy the absurd separate exception allowed by the original ruling, while failing to meet the fundamental equal requirement. All in all, a proud day for politicians everywhere.

Instead, this gets to the problem that we’re facing as a civil society: our politicians are allowed to ignore the Constitution(s) they’re expected to uphold.

But Assemblyman Ronald S. Dancer, a Republican from Ocean County, said that the bill was an affront to the Bible, and that “this is one time that I cannot compromise my personal beliefs and faiths.”

I’m not familiar with New Jersey’s practices, but I’m willing to guess that Assemblyman Dancer is not sworn to uphold the Bible or his personal beliefs and faiths. Unfortunately, another state legislator understands the true end-game here, so those of us who support equality are busted:

“I believe the foundation of our state is families, marriage, one man, one woman,” said Senator Robert W. Singer, the Republican from Jackson who sponsored the amendment proposal. “Why do you want to crumble that? We’re not taking away anyone’s rights, just sanctifying what marriage is.”

I can’t wait until the day that the foundation of New Jersey and the United States as a whole crumbles because gay Americans enjoy equal rights. I long for it with my very being. I also want the terrorists to win on that day. And I hate children. And puppies. Definitely puppies.

Politicians are stupid.

Happy Birthday, Bill of Rights?

Umm, okay:

The most positive trend of 2006 (surely there had to be one) was described in The Wall Street Journal earlier this month by Jeff Zaslow in a piece titled, “Comedy Comes Clean.” Notwithstanding the fact that the movie “Borat” was a “scatological sensation,” Mr. Zaslow described stand-up comedy’s new turn toward humor passed through a sieve of normal decency. My favorite, from comedian Michael Jr.: “Someone asked me if I’m pro-gay. I’m not pro-gay or amateur gay. I didn’t even know they had a league.”

Wow, isn’t that wonderful? I’m skeptical about the claim that comedy has suddenly turned to normal decency, whatever that is. But if it has, fine. What I’m fascinated by is the apparent push for this through the self-correcting nature of the (comedy) market. If this can happen, and it does as economics explains with all sub-markets of the overall market, what justification exists for allowing the Congress to continue violating the Constitution through the FCC?

The author, an editor at the Wall Street Journal, goes on to place the blame, or at least causation, for the new trend at the feet of Eddie Murphy. The argument makes little sense, but it’s mostly irrelevant to the topic. Some comedians use the f-word. Some don’t. This is not news. Instead, the essay seems to serve little purpose other than to allow the author to close with this:

Can we blame this verbal morass on the Supreme Court? Maybe. Back in 1973, in Papish, the court ruled on a college that tried to ban a student newspaper showing a cop raping the Statue of Liberty. The college had a rule that students should observe “generally accepted standards of conduct.” It lost, 6-3.

Chief Justice Warren Burger’s long-forgotten dissent is relevant to a society today that vulgarizes simple conversation while euphemizing or banning its darker thoughts. Justice Burger defended the right of students to criticize their school or government “in vigorous, or even harsh, terms.” But he called the student publication “obscene and infantile.” A university, he suggested, is ” an institution where individuals learn to express themselves in acceptable, civil terms. We provide that environment to the end that students may learn the self-restraint necessary to the functioning of a civilized society and understand the need for those external restraints to which we must all submit if group existence is to be tolerable.”

“Tolerable.” That’s an interesting, old-fashioned word. It’s not quite the same as “tolerant,” is it? As t-words go, I think I prefer “tolerable” to the current alternatives.

I can think of a word to describe Chief Justice Burger’s dissent, but it isn’t tolerable. External restraints? When coming from the government, for no other reason than to make group existence “tolerable”, whatever that means, external restraint should be seen as a clear violation of the First Amendment. You’re not wise enough to be trusted with freedom. We must restrain you, lest you wreak havoc on society. Silly gobbledygook. And execrable.

Consume your clean comedy if it makes you happy, but you do not have a legitimate right to prevent me from enjoying “unclean” comedy.

Better Than Other Proposals – Still Obviously Wrong

I’ve written about Sen. Ron Wyden in the past, in less than favorable terms. Today, I’m feeling antagonistic. I’ll try to contain myself.

Several business and labor leaders on Wednesday hailed a proposal to provide health care coverage to all Americans through a pool of private insurance plans.

A dozen years after Congress rejected a Clinton administration plan for universal health care, Oregon Sen. Ron Wyden offered a plan he said would provide affordable, private health care coverage for all Americans, except those covered through Medicare or the military.

“Employer-based coverage is melting away like a Popsicle on the sidewalk in August,” Wyden said.

Wyden, a Democrat and a member of the Senate Finance health care subcommittee, said his plan would “guarantee health coverage for every American that is at least as good as members of Congress receive and can never be taken away.”

Wishing something true and having it come true are not the same. The pool will, of course, not stay private. If the plan is affordable, it will be crap. Employer-based coverage should melt away because it’s a horrible scheme for keeping people insured and for maintaining economic efficiency. And “can never be taken away” is as empty a promise as you’ll hear today, at least since no one is talking about Social Security. Basically, before presenting the facts, it’s clear this will be a steaming pile.

Before getting to the plan, let’s consider what the business and labor leaders said:

Continue reading “Better Than Other Proposals – Still Obviously Wrong”

Free market economics, not surgery

I’ve held off posting this because I try to pace myself on the circumcision posts. But today is the perfect day to comment. For a rational take on the problem of HIV/AIDS in Africa, consider Emily Oster’s recent article from Esquire:

When I began studying the HIV epidemic in Africa a few years ago, there were few other economists working on the topic and almost none on the specific issues that interested me. It’s not that the questions I wanted to answer weren’t being asked. They were. But they were being asked by anthropologists, sociologists, and public-health officials.

That’s an important distinction. These disciplines believe that cultural differences—differences in how entire groups of people think and act—account for broader social and regional trends. AIDS became a disaster in Africa, the thinking goes, because Africans didn’t know how to deal with it.

Economists like me don’t trust that argument. We assume everyone is fundamentally alike; we believe circumstances, not culture, drive people’s decisions, including decisions about sex and disease.

I’ve studied the epidemic from that perspective. I’m one of the few people who have done so. And I’ve learned that a lot of what we’ve been told about it is wrong. Below are three things the world needs to know about AIDS in Africa.

I can’t recommend the article enough, as Ms. Oster explains the HIV crisis in Africa in terms at least as plausible as any prevailing theory. It just might be possible that believing the future will be worth living encourages people to make better choices. If that’s correct, circumcision won’t make the difference in Africa that its proponents hope. Again, we must ask ourselves whether solving the problem is more important than addressing it with a preferred solution. Accurate assumptions are vital.

Sticking with today’s theme

If the topic wasn’t so serious and offensive, I’d be laughing at this ridiculous assertion:

In order to support countries or institutions that decide to scale up male circumcision services, WHO, the UNAIDS Secretariat and their partners are developing:

  • technical guidance on ethical, rights-based, clinical and programmatic approaches to male circumcision;

Neither the WHO nor UNAIDS recognizes any ethical or rights-based argument against male circumcision. It would take a gullible person to believe either organization will suddenly find truth from this announcement by the NIH.

Key Word Omission Watch – Blogs

Continuing with the series, here’s a look at what bloggers are saying. I will excerpt some relevant passages, since blogs allow for commentary instead of the “reporting” offered by news media.

First, from Queerty:

The studies have yet to delve into the dark world of anal sex. Reseachers [sic] from John Hopkins University are currently looking into a relationship between the controversial female circumcision and viral exposure.

Want to guess how well that study will go over if the data supports a preventative effect for female circumcision? If the effect is the same and no one supports changing the Female Genital Mutilation Act to let parents circumcise their daughters, everyone now promoting circumcision of male infants as an HIV preventative is at best a hypocrite. Of course, they’re already hypocrites if they believe male circumcision should be legal and female circumcision should be illegal. HIV makes no difference.

Continue reading “Key Word Omission Watch – Blogs”

Key Word Omission Watch – News

I predicted this a few hours ago, but I claim no credit for something so obvious. I want to highlight some of the ignorance and irresponsibility in reporting the NIH’s announcement on circumcision, which includes Adult Male Circumcision … in the title. I’m going to report the headlines from news media (including press releases and derivations), since that’s the extent of what I suspect most people willing to circumcise will read. It’s the key word, so it should be in every headline. Without further ado:

Continue reading “Key Word Omission Watch – News”