As the economy begins to recover, we are continually bombarded with numbers, figures, and statistics. Unemployment now stands at 17.2 percent. On the bright side, only 110,000 jobs were lost last month, better that the 130,00 that were expected to be lost. Not so good news is that the average length of unemployment has risen to more than 28 weeks. We are now in the 23rd straight month of job losses. Most of the statistics are grim.
To the guy who has been out of work for several months and is facing the loss of his home, does it matter that 20,000 fewer jobs were lost last month? Does it matter to those struggling to meet their bills without jobs that weekly earnings rose $4.08, or that the average workweek rose from 33 hours to 33.2? The dour statistics, such as the rise of joblessness in Texas from 8.2 percent to 8.3 percent might help some to not take their circumstances so personally. But the bright statistics do little for the millions not included in them.
No doubt, improving statistics increases optimism. Some who are close to giving up might take encouragement in the numbers and renew their efforts to find a job. Those who are worried about losing their jobs might sleep a bit easier. But for all the solemnity and enthusiasm of economic reports, the parade of numbers seems more like a score card than a report card, and Obama is trying to win. When it comes down to it, the only economic numbers that matter are your own. Decimals do not provide much satisfaction.
Saturday, December 5, 2009
Friday, December 4, 2009
State Control No Longer Out of Fashion
In 1927, Joseph Stalin, his power secure, began to concern himself in earnest with the state of the Soviet Union. The economy was in shambles. Production was dismal. People were starving. If the USSR was to survive, it needed to modernize and improve its economy. In response, Stalin introduced his first 5 Year Plan.
The first 5 Year Plan addressed the economy as a whole. Education, agriculture, transportation, manufacturing, health, along with many others areas of the economy, were cited as in need of reform and progress. Committees were established and information was gathered and studied. Eventually, determinations were made and goals were set. In 1928, it was ordered that coal production be increased by 1,115%; iron production by 200%; electricity by 335%. Similar increases were demanded in food production, housing, and virtually every other area of the economy. It was determined that 250,000 tractors would have to be produced.
While few of the goals were achieved, there were significant increases in production: enough to convince the planners that they were on the right track. Millions starved and were imprisoned, but production increased. The "success" of the first 5 Year Plan led to more being created. Some were more successful than others. Later plans would concern themselves with particular areas of the economy that were identified as in need of government intervention: "stimulation" would be the polite word for it. In each case, needs were identified by the government and goals were set. Plans and policies were then made and implemented. Even though the Soviets were able to achieve much and made remarkable advancements in many fields, the economy stagnated. People suffered. Eventually, the Soviet Union collapsed.
Today in Washington, the administration and Congress survey a nation that, while not in shambles, is in need of help. Experts are assembled. Examinations are made and needs identified. Information is gathered and studied. Determinations are made. Plans are formulated and policies implemented. Money and resources are allocated. It is not unlikely that there will be some success. Statistics will be provided on how productivity has improved in this or that area and how the life of citizens has improved according to this index or that. Credit will be claimed and honors bestowed. Policy will be vindicated. Rewards will be expected.
The U.S. today is manifestly different than the Soviet Union of the 1930's. Little, if any, of the backwardness and incompetence that plagued the Soviets is prevalent in the U.S. Our infrastructure is dramatically superior to what the Soviets had. Our workers are better trained, educated, and motivated that the Soviets' ever were. Our government is arguably much more enlightened. So, why are we taking lessons from the Soviets? Why are we obsessively collecting data and forever convening commissions and panels to study that data? Why are so many in Washington preoccupied with setting goals for our economy and identifying those areas most in need of "stimulation"? Why is the government so determined to manipulate the economy? Why is the government seeking to take control of the health care industry, of one of the most vibrant sectors of our economy?
It is one thing for IBM to study the market, gather information, and set goals. It is quite another for the government to do so. IBM has simple goals: its goal is to make a profit. The federal government has many goals, least of which is to make a profit.
As was the case in the Soviet Union, capitalists and capitalism are increasingly objects of suspicion and criticism. The desire to make a profit is a suspicious motive at best. Often, industries that seek to make a profit are criticized when their goals are perceived as incongruous with public goals; whatever those goals may be at the moment. Health insurance companies are today a fashionable target for those angry at the bourgeoisie. Their attempts to make a profit are cited as proof of their counterrevolutionary ideas. The state must intervene in health care, as it has in so many other areas, to defend the working class and the common man against the injustice and greed of capitalists. In the Soviet Union, the government claimed that its policies and programs were formulated and implemented in the name of the people: an argument that is increasingly familiar today.
Sadly, as was also the case in the Soviet Union, power claimed by the government is just that: power claimed by the government. Though it will be proclaimed that the power belongs to the people, it will be wielded by the government and the bureaucrats. It will belong to the people in name only. Centralized planning and state control are no longer out of fashion. In the Soviet Union, everything was political. Unfortunately, that too, is a concept no longer out of fashion.
The first 5 Year Plan addressed the economy as a whole. Education, agriculture, transportation, manufacturing, health, along with many others areas of the economy, were cited as in need of reform and progress. Committees were established and information was gathered and studied. Eventually, determinations were made and goals were set. In 1928, it was ordered that coal production be increased by 1,115%; iron production by 200%; electricity by 335%. Similar increases were demanded in food production, housing, and virtually every other area of the economy. It was determined that 250,000 tractors would have to be produced.
While few of the goals were achieved, there were significant increases in production: enough to convince the planners that they were on the right track. Millions starved and were imprisoned, but production increased. The "success" of the first 5 Year Plan led to more being created. Some were more successful than others. Later plans would concern themselves with particular areas of the economy that were identified as in need of government intervention: "stimulation" would be the polite word for it. In each case, needs were identified by the government and goals were set. Plans and policies were then made and implemented. Even though the Soviets were able to achieve much and made remarkable advancements in many fields, the economy stagnated. People suffered. Eventually, the Soviet Union collapsed.
Today in Washington, the administration and Congress survey a nation that, while not in shambles, is in need of help. Experts are assembled. Examinations are made and needs identified. Information is gathered and studied. Determinations are made. Plans are formulated and policies implemented. Money and resources are allocated. It is not unlikely that there will be some success. Statistics will be provided on how productivity has improved in this or that area and how the life of citizens has improved according to this index or that. Credit will be claimed and honors bestowed. Policy will be vindicated. Rewards will be expected.
The U.S. today is manifestly different than the Soviet Union of the 1930's. Little, if any, of the backwardness and incompetence that plagued the Soviets is prevalent in the U.S. Our infrastructure is dramatically superior to what the Soviets had. Our workers are better trained, educated, and motivated that the Soviets' ever were. Our government is arguably much more enlightened. So, why are we taking lessons from the Soviets? Why are we obsessively collecting data and forever convening commissions and panels to study that data? Why are so many in Washington preoccupied with setting goals for our economy and identifying those areas most in need of "stimulation"? Why is the government so determined to manipulate the economy? Why is the government seeking to take control of the health care industry, of one of the most vibrant sectors of our economy?
It is one thing for IBM to study the market, gather information, and set goals. It is quite another for the government to do so. IBM has simple goals: its goal is to make a profit. The federal government has many goals, least of which is to make a profit.
As was the case in the Soviet Union, capitalists and capitalism are increasingly objects of suspicion and criticism. The desire to make a profit is a suspicious motive at best. Often, industries that seek to make a profit are criticized when their goals are perceived as incongruous with public goals; whatever those goals may be at the moment. Health insurance companies are today a fashionable target for those angry at the bourgeoisie. Their attempts to make a profit are cited as proof of their counterrevolutionary ideas. The state must intervene in health care, as it has in so many other areas, to defend the working class and the common man against the injustice and greed of capitalists. In the Soviet Union, the government claimed that its policies and programs were formulated and implemented in the name of the people: an argument that is increasingly familiar today.
Sadly, as was also the case in the Soviet Union, power claimed by the government is just that: power claimed by the government. Though it will be proclaimed that the power belongs to the people, it will be wielded by the government and the bureaucrats. It will belong to the people in name only. Centralized planning and state control are no longer out of fashion. In the Soviet Union, everything was political. Unfortunately, that too, is a concept no longer out of fashion.
Monday, November 30, 2009
Tough Slog on Healthcare
The Senate today is set to begin debate on health care reform (formerly referred to as national health care). A "tough slog" is expected. Senate Majority Leader Harry Reid announced with firm resolve and sense of mission that "generation after generation has called upon us to fix this broken system." Read and others are determined to succeed where so many have failed. "We are now closer than ever to getting it done."
I have been around for some time and I do not recall the public clamoring for health care "reform" until relatively recently. There was a considerable amount of grumbling perhaps, but the clamoring only began when national health care was put on the table. That aside, continuing with the slight of hand that made the insurance industry the target of reform rather than the health care industry, Reid continued by adding that National Health Care would halt the reprehensible practice by health care insurance companies of providing coverage in a way that allows them to make a profit. In this regard, government provided health care has a distinct advantage. It does not have to make a profit. Indeed, it is prepared to lose billions; a luxury private insurance companies do not have.
There was also chagrin on the part of some like Paul Ginsburg, president of the Center for Studying Health System Change, at those who insist on debating "issues that aren't important to the workability of health reform." The impatience on the part of Ginsberg and other technocrats is presumably due to the insistence by some on limiting or banning abortion coverage, contraceptives, and other controversial issues. To some, the issue of National Health Care is a matter of policy and economics. These are the ones oblivious to the social and political consequences of attempting to provide universal coverage. To them, health care reform is merely a political contest over money and power.
But health care reform is not simply a political or economic contest: it is much more. Health care is an intimate and deeply personal issue to many Americans. An ill or injured sibling, parent, or child is not the same thing as needing to refinance a loan or falling behind on the mortgage. Needing surgery or treatment is not the same thing as needing a new car or a job. There are many, indeed too many, in this country that need help in obtaining and paying for health care. Something should be done. But nationalizing health care is not it. There are other ways, such as subsidizing coverage to enable health insurance providers to cover those who do not make them a profit. The government could take steps to assist the many private charities and foundations that already provide health care to those who need and cannot afford it. However assisting the private sector and charities to meet a need would deny many in Washington the victory, control, and credit they seek. In Washington, is not enough to help people in need. Glory must be had as well.
I have been around for some time and I do not recall the public clamoring for health care "reform" until relatively recently. There was a considerable amount of grumbling perhaps, but the clamoring only began when national health care was put on the table. That aside, continuing with the slight of hand that made the insurance industry the target of reform rather than the health care industry, Reid continued by adding that National Health Care would halt the reprehensible practice by health care insurance companies of providing coverage in a way that allows them to make a profit. In this regard, government provided health care has a distinct advantage. It does not have to make a profit. Indeed, it is prepared to lose billions; a luxury private insurance companies do not have.
There was also chagrin on the part of some like Paul Ginsburg, president of the Center for Studying Health System Change, at those who insist on debating "issues that aren't important to the workability of health reform." The impatience on the part of Ginsberg and other technocrats is presumably due to the insistence by some on limiting or banning abortion coverage, contraceptives, and other controversial issues. To some, the issue of National Health Care is a matter of policy and economics. These are the ones oblivious to the social and political consequences of attempting to provide universal coverage. To them, health care reform is merely a political contest over money and power.
But health care reform is not simply a political or economic contest: it is much more. Health care is an intimate and deeply personal issue to many Americans. An ill or injured sibling, parent, or child is not the same thing as needing to refinance a loan or falling behind on the mortgage. Needing surgery or treatment is not the same thing as needing a new car or a job. There are many, indeed too many, in this country that need help in obtaining and paying for health care. Something should be done. But nationalizing health care is not it. There are other ways, such as subsidizing coverage to enable health insurance providers to cover those who do not make them a profit. The government could take steps to assist the many private charities and foundations that already provide health care to those who need and cannot afford it. However assisting the private sector and charities to meet a need would deny many in Washington the victory, control, and credit they seek. In Washington, is not enough to help people in need. Glory must be had as well.
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