Reading over my last post, it seems a bit more pessimistic than I intended. Today we drove across the Mojave desert in 103 degree temperatures, listening to "The Wisdom of History" by Professor J. Rufus Fears, University of Oklahoma, one of the Teaching Company courses. Perhaps the high temperature has gotten to me.
What comes across from this course, time and again throughout history, is the inevitable evolution of a ruling elite, who quite naturally work to preserve their power, wealth, and privileged position, and eventually end up destroying their nation or society as a consequence. Time and again the ruling elite proves adept at maximizing their own short term gains, and oblivious to the long term threats to their culture, nation or empire. And part of the reason they are oblivious to the gathering threats is because they become more and more isolated from reality, more and more driven by a common ingroup world view.
This is a common thread throughout the history of the world, across all ages and cultures. It happened in ancient Greece and Rome and China. It happened in recent history in the empires of Spain, Britain, and the Soviet Union. It is happening today in Iran and China. And I cannot help but see the same pattern in our own nation, ruled by an elite coalition of powerful politicians and wealthy CEOs.
The interesting question is whether there is anything unique about the American system of democracy that can evade what seems to be an inevitable historical pattern of national decay and decline.
Tuesday, June 30, 2009
The fatal flaw
I have been thinking about recent American actions - in Iraq and Pakistan and Afghanistan and North Korea and Guantanamo, with the stimulus package, the climate bill, and the currently-being-assembled health care bill. Stepping back and looking over all these recent actions, three things seem apparent to me:
1. President Obama is a wonderful orator, but in fact he seems to have ceded to the Democratic majority in Congress the shaping of all major policies and the details of all major bills. It appears he will be satisfied if he can claim to have passed bills addressing his stated priorities, without too much worry about what form they finally take. That is probably politically very astute for his party, but in the long run probably very bad for the nation.
2. Congress is, quite naturally, in the thrall of the special interests that pay for their campaigns, so the bills that are coming out are carefully crafted to appeal to all the special interests. Wall Street reform stops short of really affecting the high-paid CEOs or reining in the high-flying hedge funds. The cap-and-trade bill ends up giving - not selling - the permits to politically well-placed industries and companies. The stimulus bill doled out money to all sorts of politically well-placed groups, without much regard for whether it would really provide quick and effective stimulus. The military is being forced to buy more F-22 fighters and C-17 cargo planes, even though they don't want them, because they are built in the districts of powerful Congressional advocates.
3. Underneath it all, this administration has so far outstripped the already-appalling deficits run up be the previous administration that the Bush administration looks fiscally responsible by comparison. That is some achievement! Of course someday all this debt has to be paid off, or defaulted, or reduced by allowing high inflation.
I don't find any of this surprising. Students of history can find the same sort of parochial political behavior throughout history, back at least to the Roman Empire. But I do worry that our current political process is inadequate to handle the complexities and dangers of a modern, dangerous, nuclear, multipolar world.
It's not that I hope for a change in political party - looked at over the past 50 years or so, the Republicans have shown themselves to be no better (and no worse) than the Democrats at running the nation. I hope for something more fundamental - a return to statecraft in Washington and to strategic thinking in military affairs. But I have no idea what could unseat the current incestuous Congressional-Military-Industrial complex and replace it with a more disinterested and objective form of government.
Perhaps that is why empires, like people, eventually die. They reach the point where their systems cannot be repaired, and the only remedy is to bury them and let another younger and more fit generation (or nation) take their place.
1. President Obama is a wonderful orator, but in fact he seems to have ceded to the Democratic majority in Congress the shaping of all major policies and the details of all major bills. It appears he will be satisfied if he can claim to have passed bills addressing his stated priorities, without too much worry about what form they finally take. That is probably politically very astute for his party, but in the long run probably very bad for the nation.
2. Congress is, quite naturally, in the thrall of the special interests that pay for their campaigns, so the bills that are coming out are carefully crafted to appeal to all the special interests. Wall Street reform stops short of really affecting the high-paid CEOs or reining in the high-flying hedge funds. The cap-and-trade bill ends up giving - not selling - the permits to politically well-placed industries and companies. The stimulus bill doled out money to all sorts of politically well-placed groups, without much regard for whether it would really provide quick and effective stimulus. The military is being forced to buy more F-22 fighters and C-17 cargo planes, even though they don't want them, because they are built in the districts of powerful Congressional advocates.
3. Underneath it all, this administration has so far outstripped the already-appalling deficits run up be the previous administration that the Bush administration looks fiscally responsible by comparison. That is some achievement! Of course someday all this debt has to be paid off, or defaulted, or reduced by allowing high inflation.
I don't find any of this surprising. Students of history can find the same sort of parochial political behavior throughout history, back at least to the Roman Empire. But I do worry that our current political process is inadequate to handle the complexities and dangers of a modern, dangerous, nuclear, multipolar world.
It's not that I hope for a change in political party - looked at over the past 50 years or so, the Republicans have shown themselves to be no better (and no worse) than the Democrats at running the nation. I hope for something more fundamental - a return to statecraft in Washington and to strategic thinking in military affairs. But I have no idea what could unseat the current incestuous Congressional-Military-Industrial complex and replace it with a more disinterested and objective form of government.
Perhaps that is why empires, like people, eventually die. They reach the point where their systems cannot be repaired, and the only remedy is to bury them and let another younger and more fit generation (or nation) take their place.
Wednesday, June 24, 2009
Freedom for Iran?
There has been a good bit of fevered speculation in the world press about Iran's opposition movement, as if it were pressing for full freedom for the people of Iran. As one more down-to-earth writer put it, however, this is much more like the battle in the book and movie "The Godfather", between the Corleone family and the Tattaglia family - no good guys, just bad and worse. In fact both sides in this confrontation have a lot to lose - politically and financially - if the current system falls apart. So really this isn't a battle for the freedom of the average Iranian; it's a battle for who will control the levers of power in what is, in essence, simply a dictatorship.
Monday, June 22, 2009
The mark of a despot
The surest mark of a despotic government is when it tries strenuously to hide what it is doing. In Iran they are expelling foreign journalists, arresting domestic journalists, closing down news bureaus, trying to turn off the cell phone and text messaging systems and filtering internet access, beating up people on the streets found with cameras or camera phones, and protesting loudly about the stories and pictures being shown in the foreign press.
Looks like a standard tinpot dictatorship to me.
Looks like a standard tinpot dictatorship to me.
Saturday, June 20, 2009
The power of people seeking freedom
The courage of all those Iranians fighting for their freedom is enormously moving. And something profound is happening in the world as the young find innumerable inventive ways to get around the regime's attempts to block their messages and blogs and pictures from the embattled streets. Here is a blog message that has gone around the world tonight -- and it will have more affect than any propaganda message from the narrow-minded ruling theocracy there:
8:53 PM ET -- "Sister, have a short sleep, your last dream be sweet." Yesterday we printed a touching letter from an Iranian woman that began with these ominous lines: "I will participate in the demonstrations tomorrow. Maybe they will turn violent. Maybe I will be one of the people who is going to get killed..."
Tonight, she posted a second letter, passed along and translated by two readers. She writes about her "sister" in this cause who was killed today, referring to Neda.
Yesterday I wrote a note, with the subject line "tomorrow is a great day perhaps tomorrow I'll be killed." I'm here to let you know I'm alive but my sister was killed...
I'm here to tell you my sister died while in her father's hands
I'm here to tell you my sister had big dreams...
I'm here to tell you my sister who died was a decent person... and like me yearned for a day when her hair would be swept by the wind... and like me read "Forough" [Forough Farrokhzad]... and longed to live free and equal... and she longed to hold her head up and announce, "I'm Iranian"... and she longed to one day fall in love to a man with a shaggy hair... and she longed for a daughter to braid her hair and sing lullaby by her crib...
my sister died from not having life... my sister died as injustice has no end... my sister died since she loved life too much... and my sister died since she lovingly cared for people...
my loving sister, I wish you had closed your eyes when your time had come... the very end of your last glance burns my soul....
sister have a short sleep. your last dream be sweet.
Iran
So much for the fiction that Iran is an Islamic Republic. Clearly it neither follows the precepts of the Qur’an nor the rules of a democracy. Whether or not the last election was rigged, the use of police and army units today in Tehran to suppress unarmed demonstrators, the wholesale arrest of opposition leaders, the suppression of web sites and phone communication, and the telephoned threats to people who might demonstrate on the streets mark this as nothing more than another authoritarian regime trying to stay in power by using their tame thugs to intimidate people. In that respect, Iran, for all its high-flown rhetoric and piously-clad mullahs, is politically no better than the Chinese at Tiananmen Square, the Soviets in the 1956 Hungarian Revolution, or the current North Korean regime.
Clearly there is a power struggle going on in the highest levels of government, but just as clearly no one in the upper reaches of government is prepared to give any weight to the obvious discontent of large segments of the population, who are clearly tired of the repressive theocracy and the isolation from the world mainstream.
Well, these things have a way of sorting themselves out over time, usually to the eventual destruction of the ruling dictators. One can only hope that not too many people have to die before the regime loosens its grip.
Clearly there is a power struggle going on in the highest levels of government, but just as clearly no one in the upper reaches of government is prepared to give any weight to the obvious discontent of large segments of the population, who are clearly tired of the repressive theocracy and the isolation from the world mainstream.
Well, these things have a way of sorting themselves out over time, usually to the eventual destruction of the ruling dictators. One can only hope that not too many people have to die before the regime loosens its grip.
Wednesday, June 17, 2009
Health Care Doublethink
“The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it. The first lesson of politics is to disregard the first lesson of economics”, Thomas Sowell
As of 2004, there were about 850,000 practicing doctors in the U.S. (AMA Physician Characteristics and Distribution in the US, 2004, ISBN 1-57947-418-7). About 40% of them are in primary care, and about 60% in specialties. There are now just over 300,000,000 Americans in this country, so there is about 1 primary care doctor for every 1000 Americans, clearly not enough. Moreover, these doctors are not distributed evenly about the country; they are heavily concentrated in metropolitan areas, so for much of America the real ratio is about 1 primary care doctor for every 4000-5000 people.
Now politicians love to score points by promising universal health care and lower health care costs at the same time. Currently the government is contemplating reducing already low Medicare payments to physicians by about 21% to reduce Medicare costs.
To become a doctor takes 4 years of undergraduate school, 4 years of medical school, and 3 to 8 years of internship and residency, depending on the specialty selected. So that is something like 11-16 years of 80-100 hour work weeks, high tuition costs and little or no pay. Physicians typically end this training with debts in the $100,000-$300,000 range.
So we want more young people to undergo the arduous and expensive process of becoming physicians, so that there will be enough doctors to give every American good health care. And at the same time we want to sharply reduce physician’s incomes, and therefore the incentive to undergo the arduous and expensive training. Only politicians could propose something this stupid!
There are things politicians could do to really improve health care. The first would be to limit the excessive malpractice litigation which costs doctors so much and provides a strong incentive for excessive expensive tests (to protect against later malpractice charges). Lobbying organizations for lawyers, using selective data, argue strenuously that there is no excessive litigation, and that insurance costs aren’t really that much, but the facts on the ground show otherwise. Substantial numbers of physicians are leaving high risk fields like obstetrics because of the high cost of malpractice insurance (which can run as high as $250,000 or more per year in some areas of the country).
But of course, politicians at the federal level are heavily indebted to the legal profession (in fact, the majority are lawyers themselves), so they are hardly likely to pass any effective legislation that would significantly impact the legal profession.
Another thing politicians could do would be to remove the current federal restrictions against buying medications by mail from Mexico or Canada. In many cases drug companies charge far less for the same drugs in these countries than they do in the U.S. The FDA argues that there may be quality control problems with these “foreign” drugs, but this is just a cover for their tacit support of the drug companies, because in a number of cases the drugs sold in the U.S. are actually manufactured out of the country anyway –some of them in Canada or Mexico.
As of 2004, there were about 850,000 practicing doctors in the U.S. (AMA Physician Characteristics and Distribution in the US, 2004, ISBN 1-57947-418-7). About 40% of them are in primary care, and about 60% in specialties. There are now just over 300,000,000 Americans in this country, so there is about 1 primary care doctor for every 1000 Americans, clearly not enough. Moreover, these doctors are not distributed evenly about the country; they are heavily concentrated in metropolitan areas, so for much of America the real ratio is about 1 primary care doctor for every 4000-5000 people.
Now politicians love to score points by promising universal health care and lower health care costs at the same time. Currently the government is contemplating reducing already low Medicare payments to physicians by about 21% to reduce Medicare costs.
To become a doctor takes 4 years of undergraduate school, 4 years of medical school, and 3 to 8 years of internship and residency, depending on the specialty selected. So that is something like 11-16 years of 80-100 hour work weeks, high tuition costs and little or no pay. Physicians typically end this training with debts in the $100,000-$300,000 range.
So we want more young people to undergo the arduous and expensive process of becoming physicians, so that there will be enough doctors to give every American good health care. And at the same time we want to sharply reduce physician’s incomes, and therefore the incentive to undergo the arduous and expensive training. Only politicians could propose something this stupid!
There are things politicians could do to really improve health care. The first would be to limit the excessive malpractice litigation which costs doctors so much and provides a strong incentive for excessive expensive tests (to protect against later malpractice charges). Lobbying organizations for lawyers, using selective data, argue strenuously that there is no excessive litigation, and that insurance costs aren’t really that much, but the facts on the ground show otherwise. Substantial numbers of physicians are leaving high risk fields like obstetrics because of the high cost of malpractice insurance (which can run as high as $250,000 or more per year in some areas of the country).
But of course, politicians at the federal level are heavily indebted to the legal profession (in fact, the majority are lawyers themselves), so they are hardly likely to pass any effective legislation that would significantly impact the legal profession.
Another thing politicians could do would be to remove the current federal restrictions against buying medications by mail from Mexico or Canada. In many cases drug companies charge far less for the same drugs in these countries than they do in the U.S. The FDA argues that there may be quality control problems with these “foreign” drugs, but this is just a cover for their tacit support of the drug companies, because in a number of cases the drugs sold in the U.S. are actually manufactured out of the country anyway –some of them in Canada or Mexico.
Recommended - You Be Obama
I recommend David Brook's article yesterday in the New York Times, You Be Obama. The health care issue has defeated every politician thus far who has tried to do something about it. It will be interesting to see if President Obama can pull off at least a partial improvement, despite the huge array of special interests defending every nook and cranny of the current system.
Tuesday, June 9, 2009
The Reckoning
Victor Davis Hanson is something of a curmudgeon, but he is very smart and understands history. His recent article The Reckoning is well worth reading. As he points out, it is a losing battle to go against human nature. Grand eloquent speeches are nice, but they never change other people's bad behavior - only consequences or the threat of consequences changes people's bad behavior.
New Health Care bill
A draft of the health care bill being prepared by the the Senate Health, Education, Labor, and Pensions committee, chaired by Senator Kennedy, leaked over the weekend. For a pretty good review of its contents, see http://keithhennessey.com/2009/06/08/kennedy-health-bill/. Voters had better pay attention to this legislative battle as it unfolds, because it is going to affect every one of us, for better or worse.
Monday, June 8, 2009
Recommended – Deadly Decisions
Christopher Burns has written a new book, Deadly Decisions, (see details in the book list on the sidebar) in which he examines how groups of people make erroneous decisions. Reviewing the sinking of the Titanic, the Three Mile Island nuclear incident, the USS Vincennes mistaken attack on an Iranian airliner, the loss of the two space shuttles, the missed signals that the 9/11 attacks were coming, the collapse of Enron, the incorrect intelligence about Saddam Hussain’s supposed weapons of mass destruction, and a number of other recent disasters, he tries to explain how organizations full of supposedly very intelligent people so often find themselves led to incorrect decisions by a combination of human mental habits, organizational expectations, and an inability to detect or recognize bad data.
Well worth reading
Well worth reading
Recommended - Rising Above I.Q.
I recommend Nicholas Kristof's Op-Ed piece Rising Above I.Q. in the June 6, 2009 New York Times. As I have remarked elsewhere, culture matters. Cultures that inculcate diligence and respect for hard work and education do better than cultures that don't. One would think that would be obvious, but apparently it isn't to many people.
Recommended - My Drug Problem
Along the same lines as the previous post, I recommend Virginia Postrel's column My Drug Problem in the March 2009 Atlantic Monthly. As she points out, if she lived in a country with nationalized medicine, like England or New Zealand, she would probably be dead, since she probably wouldn't have had access to the (expensive) drugs that saved her life.
Thursday, June 4, 2009
Recommended - Death of US Health Care
I recommend Dick Morris's May 12 article Death of US Health Care in The Hill. He is right - the only realistic way to cut health care costs is to ration access to doctors, expensive drugs and medical procedures. Cheaper and universal health care sounds great as a political talking point, but when voters discover that it really translates to less health care for most of us, they will not be so happy.
Some years ago an acquaintance of ours in England suffered chest pains one night. The doctor was called, and he put her in line in England's universal health care plan to get an EKG in a couple of weeks. She died of massive heart failure that very night, well before the English health care system could even get her a simple EKG. Contrast that with my own experience in the US health care system - some years ago I called my doctor's office to complain of chest pains - they had me in his office hooked to an EKG machine within the hour, and in the hospital to receive a life-saving stent within 4 hours. Which system would you prefer to live under?
Some years ago an acquaintance of ours in England suffered chest pains one night. The doctor was called, and he put her in line in England's universal health care plan to get an EKG in a couple of weeks. She died of massive heart failure that very night, well before the English health care system could even get her a simple EKG. Contrast that with my own experience in the US health care system - some years ago I called my doctor's office to complain of chest pains - they had me in his office hooked to an EKG machine within the hour, and in the hospital to receive a life-saving stent within 4 hours. Which system would you prefer to live under?
Wednesday, June 3, 2009
Treasury Note Yields
I've commented before that the huge Federal defects that we are piling up may eventually begin to spook the foreign investors who are loaning us the money to live to profligately. This week's Treasury Note auction was the third in a row to require higher than expected interest rates to lure buyers.
Buyers don't actually bid directly on the interest rates - they bid on the bonds themselves, which return their face value at maturity. In essence they bid in an auction to buy the bond at a discount from its face value. The lower the winning bid, the higher the effective interest rate is. As buyers get more worried about America's finances, it takes a larger and larger discount to attract bids.
The recent sharp rise in the effective rate (or, looked at another way, the increasing discount needed to sell new Fed notes) ought to be a warning signal to Congress and the administration to get serious about cutting the Federal defect, despite all the expensive new programs they would like to launch.
It's worth noting yet again that recent past empires, such as the British and Spanish empires, failed when they accumulated more foreign debt than they could manage. We are fast approaching that point ourselves, if we have not already reached it.
Buyers don't actually bid directly on the interest rates - they bid on the bonds themselves, which return their face value at maturity. In essence they bid in an auction to buy the bond at a discount from its face value. The lower the winning bid, the higher the effective interest rate is. As buyers get more worried about America's finances, it takes a larger and larger discount to attract bids.
The recent sharp rise in the effective rate (or, looked at another way, the increasing discount needed to sell new Fed notes) ought to be a warning signal to Congress and the administration to get serious about cutting the Federal defect, despite all the expensive new programs they would like to launch.
It's worth noting yet again that recent past empires, such as the British and Spanish empires, failed when they accumulated more foreign debt than they could manage. We are fast approaching that point ourselves, if we have not already reached it.
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