Author: Tony

The new looks like the old.

I have a lingering internal question over whether my mistrust of government is still a healthy skepticism or is now in mired in the depths of cynicism. I don’t think the difference matters significantly because I still reach the same conclusions. But the latter might make the rare exceptions harder to accept when they appear. And yet, as I wonder, a story like this on Senator McCain’s proposed “gas-tax holiday” comes along (link via John Cole):

Earlier Monday at a community college in the Philadelphia suburbs, Obama rejected a tax holiday as bad economic policy. “I’ve said I think John McCain’s proposal for a three-month tax holiday is a bad idea,” Obama said, warning consumers that any price cut would be short lived before costs spike back.

“We’re talking about 5 percent of your total cost of gas that you suspend for three months, which might save you a few hundred bucks that then will spike right up,” Obama said. “Now keep in mind that it will save you that if Exxon Mobil doesn’t decide, ‘We’ll just tack on another 5 percent on the current cost.’”

I’m calling my mental approach skepticism because Senator Obama demonstrates here what cynicism really is. Where he could talk exclusively about the stupidity of a tax holiday bribe, he had to jump into talking points. Let’s assume Exxon Mobil, since they’re the working man’s evil oppressor du jour right now, would “just tack on another 5 percent on the current cost”. Then what? I, as a price-conscious consumer in need of gasoline, drive to the Shell station where the 5 percent isn’t “just tacked on”. Although it could be, because in a competitive market, companies are able – and certainly willing, the evil bastards – to “just tack on” whatever little windfall profits they want.

I’ve heard Senator Obama is a new kind of politician. I’m not buying it. A new kind of politics would rely on something a little more honest than pandering to voters with a scapegoat and misrepresentation of economics. This is one more reason I will not be voting for Senator Obama in November.

“Just a ‘little’ off the top” is subjective.

In an essay discussing a magazine article reviewing the origin of circumcision, the author demonstrates – parenthetically – why it continues.

(The most logical explanation is simple. The male organ [sic] simply looks better post-circumcision than it does pre-circumcision. And looks matter: Consider how visual an animal the human male is and just how much time he spends gazing at himself.)

That’s not logic. That’s a subjective preference rationalized from an ex post facto analysis fueled by cultural conditioning, as well as a refusal to accept that what is common is not necessarily normal and may, in fact, be harmful.

(For my own parenthetical, the last sentence of the excerpt warrants a response, but it is beyond the scope of my more fundamental argument. If you understand my objection to the first two sentences, my critique of the third sentence is obvious.)

Then, this:

I put the magazine back on the stack, fishing for my handkerchief to deal with the chilly sweat now covering my forehead. [ed. note: There is slightly more context to this excerpt, before and after, but excluding it does not alter the meaning.]

I will never understand how circumcised men react to discussion of the topic this way, only to defend imposing on infant boys what would be so objectionable to them now. What makes a man express relief because he doesn’t remember rather than disbelief that something so objectively offensive could be forced on him? And where is the empathy, the moment of thought for other individuals that might make us ask whether or not he wants his healthy penis cut?

“Neutrality” is an interesting concept for government.

This article raises interesting issues on the need for investment in Internet infrastructure. I can’t quite decipher whether the AT&T executive is looking for government funding of this needed infrastructure. I think so, although I’m just guessing. Also, while a projected increase in network traffic as video options expand online is inevitable, I’m skeptical of this claim:

[Jim Cicconi, vice president of legislative affairs for AT&T] said: “The surge in online content is at the centre of the most dramatic changes affecting the internet today. In three years’ time, 20 typical households will generate more traffic than the entire internet today.”

In three years? I’d like to see those projections.

But that’s not my point here. Generalize this from the specifics about net neutrality and wonder why we can’t get more of this from the government.

The US Department of Justice said in a statement last year: “However well-intentioned, regulatory restraints can inefficiently skew investment, delay innovation and diminish consumer welfare, and there is reason to believe that the kinds of broad marketplace restrictions proposed in the name of ‘neutrality’ would do just that with respect to the internet.”

Regulatory restraints can inefficiently skew investment, delay innovation and diminish consumer welfare? Even when well-intentioned? Who knew?

Will they reduce rates or add more services when the economy improves?

The current, apparent economic journey into recession demonstrates why limited government is wise. Unlike individuals, who tend tighten their financial dealings through closer observance and more critical judgment, government chooses only one path during tough economic conditions.

Fairfax County yesterday joined a growing list of communities across the region that have raised property taxes this year to protect government services and public schools in the face of declining real estate values and a generally sluggish economy.

Perhaps an analysis of the Fairfax County government would reveal a limited array of indefensible services. I doubt it, but I’m rather more interested in the theoretical here. Individuals can’t simply require a higher salary when their salary falls below break-even. They must understand their need to reduce expenses, however temporarily. When services are essentially guaranteed¹ by the government, flexibility causes problems, as these counties are now discovering. No one should be surprised.

No reasonable person is going to suggest cutting out schools, for example, to save money. But if you send your children to a school that you pay for directly, will you likely be more or less inclined to scrutinize how the school spends its (i.e. your) money? Will administrators likely be more or less accountable for each penny? If there’s an important message that needs to go out, and the school usually prints for distribution, might direct concern regarding costs lead to e-mail distribution instead?

Unfortunately, we have layers of extraneous bureaucracy instead. We have distance between consumer and cost. We don’t know how to say “no” when funds are unavailable or the request is ludicrous. We concede more services as public goods, then relinquish more of our money when tax receipts fall below spending. We cease to question any previous transfer of services to government provision. And when the economy picks up, government takes the credit.

¹ Services are guaranteed. Quality, maybe not as much.

This “flexible and compassionate” is misdirected.

This article appeared in the Boston Globe last week. It’s a discussion of efforts to train new mohels in Massachusetts. Two particular passages are relevant to my focus. First:

Be flexible and compassionate, [Dr. Bob] Levenson told the doctors. … Gently tell the truth when a tearful, post-partum mother asks if babies can feel pain. (The answer is “yes, but I’ll be as quick as possible”). And it is perfectly OK – recommended, even – to anesthetize the infant with a little kosher wine dabbed on the lips.

Beyond wanting to see evidence that wine dabbed on the lips of an infant male will anesthetize him from the pain of surgery, this issue raises a large ethical red flag. There must be an objective reason to inflict pain on another, particularly a child who can’t offer (his) consent. And does the infant male’s soon-to-be-removed foreskin serve a purpose? The answer is “yes,” no parenthesis necessary or appropriate.

Second:

But for doctors, the work is not considered particularly lucrative. Mohels must secure their own malpractice insurance, spend significant time counseling families, travel, perform the ceremony on the eighth day of a child’s [sic – male] life, all for a fee of $350 or $400.

If a religious observation requires medical malpractice insurance, it is only legitimate to perform on consenting adults. The individual right of minors to be free from (medically unnecessary) harm must remain the exclusive standard, superior to any religious requirements, because risk is objectively inherent. The evaluation of that medically unnecessary risk against unverifiable religious benefits is subjective. The conclusion is only legitimate from the individual giving up his foreskin.

Housing cents in Congress is not housing sense.

Any punditry on government tinkering on the path to a mortgagee bailout that includes this sentence in the opening paragraph probably shouldn’t be taken seriously:

First Congress produced a timely and well-crafted stimulus.

Sebastian Mallaby wrote that in today’s Washington Post. It’s wrong, even if it miraculously results in actual spending on the part of recipients who understand that it’s a loan against future tax increases. Welfare is hardly a stimulus. However, that’s not the most egregious statement. Instead, this:

Of course, some fall in house prices is necessary. But absent federal action, market failure will cause real estate to fall further than the basics of supply and demand would justify. …

Naturally the market failed, because if supply and demand don’t match, the market clearly failed. Buyers aren’t able to prefer a lower price than sellers will accept. Sellers aren’t able to prefer a higher price than buyers will pay. The value each places on her preferred price can’t possibly rule out a short-term willingness to agree. Can’t we all just get along?

It doesn’t get better.

… In a healthy market, foreclosure would be rare, because it pays for a lender to forgive, say, 20 percent of a loan rather than booting the homeowner out and seeing 30 percent of the property value evaporate in the process of eviction. But because mortgages have been sliced up and distributed among far-flung investors, it’s difficult to get their consent for partial forgiveness. Homeowners get dumped on the street, and more value than necessary is destroyed.

Perhaps this is true. I’d like to read a source for this. But how does Mallaby know what specific resolution would be appropriate? Is a 20 percent forgiveness wise for the lender? Do they get the chance to work out these details with the borrower? Would the borrower be able to pay the remaining 80% of the loan? And how much financial gain resulted from the slicing and distribution of mortgages? Does that gain offset the value destroyed by the current crisis? These questions matter. We should have answers before we jump to a federal bailout of anyone.

So, although Congress would be wrong to launch a broad attempt to prop up home prices, it would be right to address the market failure that produces excessive foreclosures. The Senate is working on a smart reform that would begin to do this: It would give service companies that collect mortgage payments on behalf of creditors a legal safe harbor, allowing them to forgive part of a loan without having to fear that a few opportunistic creditors will sue them for being soft. Lenders as a whole would benefit, because the measure would reduce wasteful foreclosures. The flow of capital to future home buyers would not be compromised.

Again with the “market failure”, but more useful is Mallaby’s endorsement of Congress rewriting contracts it no longer deems acceptable under its subjective, uninformed economic analysis. How might that affect the loan market – housing and beyond – in the future if borrowers and lenders know that the key to limiting their own risk is to fail big? The last sentence demands proof more compelling than Mallaby’s wishful thinking.

I’ll take the minor tax victory where I can get it.

I’ve made it a very minor hobby to question the advice in Michelle Singletary’s The Color of Money personal finance column in the Washington Post. Yet, I can find only one quibble in yesterday’s column. The rest is very good, sensible advice. But, still, this is just strange.

I’ll confess: I filed my tax return on April 15. This year the time just seemed to come up so fast.

That shouldn’t be a confession. That’s a sign of intelligence. Barring the unexpected large refund due to a life change, no one should file taxes before the deadline. I say, regardless of the payment or refund involved, overwhelm the system at the last minute.

As a practical matter, I owed a minor penalty on the tax due when I mailed my forms on Tuesday. Even though IRS rules incorrectly considered the penalty legitimate, in spite of the unusual timings of my income and estimated tax payments for the year, I was happy to pay it in light of what I received in its place. I earned all of the interest on that not-inconsiderable sum over the course of 2007. After factoring in the taxes owed on that interest, I still came out ahead. And I got the bonus of sticking with the principle.

I won’t advance this argument, but perhaps the IRS should charge a higher penalty. Since it doesn’t, paying early would’ve been irrational. When choosing between irrational and selfish, choose selfish.

Did they need to provide permission slips?

I think this would’ve been an interesting field trip, although I can’t imagine taking such a class:

Nicki Amouri hands her camera to a friend, throws her arm over another and smiles wide as she leans in for a shot with the monument her class came to visit.

It’s a typical field trip memento — except that Amouri is visiting a brothel. The monument is a fluffy, queen-sized bed in a Western-themed party room reserved for VIPs and big spenders.

Amouri was one of a dozen Randolph College students who took a tour last week of the Chicken Ranch, a legal bordello in the desert 60 miles outside Las Vegas. The class trip, which included seminars from the working girls, capped a course on American consumption and “the ideas that consume us.”

That’s fascinating enough, I guess. The closest I ever approached such an experience, I heard second-hand about a trip to a strip club while in Slovenia for an international business consulting class during graduate school. But college class is “wacky” doesn’t intrigue me. The entire curriculum shouldn’t be that, but throwing in a diverse experience is probably useful. Instead, this is the part that frustrates me:

“We gave them all the option to either opt out or express reservations privately. No one did,” said [American Culture Program director Julio] Rodriguez, adding that he received no objections from parents or administrators.

Is there a single segment in America that hasn’t been infantilized in deference to some supposedly higher authority? Politicians, maybe?

College “kids” – adults, almost every one – are thought to still be under the direction of their parents. Financial aid is regimented around this idea, with impossible obstacles to navigate for any student who dares to assert that she is independent and supporting herself without assistance from her parents. And don’t forget the inevitable article focusing on college students and credit card debt. They’re smart, but they shouldn’t be allowed to risk making mistakes. They’ll wake up one day, lacking experience, miraculously capable of making the “right” decision.

That last sentence is snark, of course. When society releases people to their own decisions, and when they (not) inevitably make mistakes, say with a bad mortgage, Congress will be there to rescue them from their mistakes and protect them from future mistakes.

The First Amendment still protects talking points.

Senator Obama had some interesting comments the other day. Oh, not those comments. No, he shared a thought or two on public financing for political campaigns.

Senator Barack Obama said today that the public financing system for presidential campaigns, which has been in place since 1976, is antiquated and should be overhauled in the era of Internet-driven fundraising.

“I think that it is creaky and needs to be reformed if it’s going to work,” Mr. Obama told reporters at a morning news conference. “We know that the check-off system has been declining in participation and as a consequence, the amount of money raised through the public financing system may be substantially lower than the amount of money that can be raised through small donations over the Internet.”

The check-off system is a tax on those of us who are smart enough to ignore that $3 box by those of us who are not. But there’s a better point buried in there. Senator Obama has found a new, better way to finance a campaign than big, moneyed interests. (I’m correcting the ridiculous hyphen placement used in the article.) Isn’t this the same new, better way to finance a campaign advocated by Jerry Brown in 1992, with the Internet being the only difference? What Sen. Obama is ultimately saying is that the Internet is an equalizer. But that would mean that the system is no longer necessary, not that it should be swept into an updated First Amendment infringement campaign finance regulation. His campaign is showing that government can never keep up with efforts to avoid the letter of the law. His political spidey sense tells him we should still try, subjecting ourselves to a permanent game of public catch-up that “we” can never win.

Of course, it’s not about the power of the voice of the small donor, is it?

… “I would like to see a system preserved. And I intend, if I am the nominee, to have conversations with Senator McCain about how to move forward in a way that doesn’t allow third parties to overwhelm the system.”

I don’t believe that Sen. Obama is stupid enough to think that a third-party candidate is going to overwhelm the system in 2008. At the current pace of legalized incumbent entrenchment in Washington, I’ll be amazed if a third-party candidate can win in 2108, to say nothing of overwhelming “the system”. But what if some third party’s candidate did make noise? Is that bad, or do the voices of those parties not matter because we already have our two deserving parties to balance each other?

This is just a useful, if unsurprising, reminder that Senator Obama likes the outside role until he’s an insider. Just like every other politician.