Reconciling Socialism and Libertarianism through Federalism

When it comes to national politics, I am certainly a libertarian. I think the Federal budget needs to be cut massively to about a third of what it is, and I spare no department. Entitlement programs need to be put on a path of elimination, the military's focus needs to be realigned, and size needs to be drastically reduced. (100billion for an elite Navy, Air Force, Special Forces, and small Army, not two million soldiers for occupations) That said, I am not completely opposed to liberalism or socialism, and I reconcile the two via Federalism. As I said, I staunchly believe the Federal government's scope and budget needs to be drastically reduced, and that allows the freedom of the states to develop in different ways.

If the overwhelming majority of Californians want a socialist nanny-state, then that is okay with me. If Mississippians want zero government, low education levels and poor public health, that's fine with me as well. Sometimes people will say, "If you don't like X, (policy, law, politician) leave the country." That's not really feasible. When it comes to the state level, it's vastly more flexible. It's not perfectly ideal, even better would be decentralization to the city level which would allow for simpler Tiebout sorting. However, some programs rely on economies of scale, and are simply not feasible for the lowest level of government.

Here are the Tiebout assumptions

1. Mobile Consumers: Consumers are free to choose where they live. There are no costs associated with moving. Obviously there are costs associated with moving, but national mobility doesn't exist really. State does, and municipal certainly.
2. Complete information Obviously complete information is difficult, but it is easy to research social programs, tax levels, and public services. Ie- Property taxes, public school levels, etc.
3. Many Communities to chose from There's one nation. 50 states. Thousands of municipalities.
4. Commuting is not an issue The Tiebout model reflects more municipal living, not Federalism, so I ignore this one.
5. Public Goods do not spill over of benefits/costs from one community to the next This is an issue, particularly for municipalities. Suburbs are often free riders of city programs.
6. An optimal city size exists: Economies of scale Likewise to states.
7. Communities try to achieve "optimal size" Likewise to states.
8. Commuties are rational and try to keep the public 'bad' consumers away. This assumption reflects more the racial/monetary sorting within municipalities, and isn't really valid for state-to-state migration.

A Dose of Healthy Realism

Let me start out this post by stating what should be the obvious: We are not going to be able to stop every single terrorist attack.

It's funny, isn't it? That should be a simple truth, given sheer probability. I'm not just talking about bombing airlines, but much simpler attacks like running into a mall and gunning down a dozen people or so, though it seems the only form of terrorism we think about is WMDs and airplanes. Whatever combination of bomb Timothy McVeigh built, I'm sure it could be done again.

Let me go a step further and propose this idea: It is not feasible, nor practical, to attempt to stop every terrorism attack. Anyone who has taken basic economics knows there's something called diminishing returns. In my class on Urban Economics, we talked about how this applies to crime, and obviously it is, there is a socially acceptable amount of crime where marginal benefit of preventing crime meets the societal marginal cost of crime. Simplified, it's this- we could have a 1:1 cop:civilian ratio, and sure, crime would be darn low, but it certainly wouldn't be worth it. This idea, that society puts an "acceptable level of risk" on human life is not easily digestible for a lot of people, and in my Urban Economics class, a lot of Sociology students took offense to the idea. But it's so stupidly obvious, right? We could set the speed limit to 30mph and save a lot of lives, but we value the benefits of a 65mph speed limit over those lives.

This doesn't mean we shouldn't be trying to stop terrorism, but it does mean our anti-terrorism plans should have a limit, and this isn't even considering the civil liberty issues at stake. When it comes to airplanes, let's figure this- in today's social climate, it is very unlikely that a terrorist crew will gain control of a large passenger jet. This isn't due to security restrictions, watch lists, airport screening, or anything like that as much as passengers will not allow it. Bolting the cockpit door helps too, a simple measure that could have saved a lot of lives on 9/11. So what we're looking at right now, as far as airplanes go, is probably bombing. Al-Qaeda has realized that hijacking is improbable and extremely difficult, and it's obvious in their plots since. We've had the shoe bomber, and now the underwear bomber. In both cases, passengers were able to foil them, but it shows that the priority is back to simply blowing the plane up.

A brief aside- If I was a non-Al-Qaeda terrorist, I'd be pretty pissed at them. Hijacking used to be a very popular and effective measure of getting things done, look at all the plane hijackings in the 1970s and 1980s for various political causes, few that ended with fatalities. Now passengers will not allow any hijacking because we assume they are going to use the plane as a giant guided missile, and thus, ruined the hijacking method for all the non-suicidal terrorists.

Anyways, they are trying to blow planes up. Let's assume a terrorist is successful, and he blows up a plane and kills 125 people. Nasty, but there have been 2-3x that amount killed since 9/11 in regular civilian plane crashes in the US alone. Now we're talking about full body scan machines in every airport, which is not only a huge privacy violation, but in general, pretty stupid. One of the manufacturers of these machines came out after the incident and said that his machines would not have detected the PETN in the guys underwear. In another brilliant Hooray-America-PR moment, a Republican South Carolina representative is proposing banning nationals of certain countries from entering the US, period, and perhaps deporting those already here. Principally, it affects Syria, Iran, Cuba, and a few others. The dirty bomber was American. The shoe bomber was English. The underwear bomber, Nigerian. 9/11 hijackers were overwhelmingly Saudi, yet this country is not on the list. Iranians and Cubans in general have done absolutely nothing to hurt this country, yet for some reason are on his McCarthy-list. It is a good demonstration at how fear-based the security policies in this country are becoming.

We're talking full-body scan machines, but how about other ways terrorists could bomb a plane by bypassing them? How about all the airport employees, who are not screened at entry? Surely a low-paid disgruntled McDonalds worker could be paid enough to smuggle in a bomb? And then there's the airlines- grounds crew, all the way up to the pilots. There's tons of security flaws in the system, and increasing the amount of security theater is unlikely to do anything other than harass an already harassed traveling public.

My Grand Vision as President

My first act as President- The American Reconstruction Act, redesigning it as brilliantly and arbitrary as the Brits did to Africa and the Middle East!
-California is divided
-Dakota is merged, or we sell North Dakota to Canada
-Michigan's upper peninsula is given to Wisconsin
-Oklahoma's ridiculous panhandle is ceded to Texas
-DC becomes a state
-NYC, Westchester, and Long Island merge with New Jersey
-Maryland is divided between Delaware, West Virgina, and Virginia
-Idaho's upper peninsula is chopped off and given to Montana

A Sociology Professor and his Idiocy

I was in the Sociology department the other day, working on a professor's computer. From the looks of the posters and such around the room, he was obviously a typical flaming elitist academic, but he was a very nice guy. And I say elitist in the real meaning of the phrase, not the Republican anti-intellectualism idea.

Anyways, Tulane has a very good Latin American studies program (2nd in the nation according to some estimates) and there is an upcoming conference on US-Cuba relations here. That was when he let out a comment, which I just found so typical of an elite academic. We were chatting about Cuba and he said something along the lines of," Yeah, I want to get there before the embargo ends and capitalism ruins it all." Smug and stupid.

The professor was obviously talking about the fact that Cuba is stuck in the 1960s. He wanted it to stay there, I suppose, as some kind of museum of the decade. But Cuba is not a museum, it is a country full of people. How many of them do you think like living in poverty, with no opportunities to advance? How many of them like driving 40-year-old cars, because that's all they can get? How many of them like the shoddy quality of products that do reach the island? How many of them like being arrested for expressing their political (or sexual) views? Given the numbers of Cuban emigrants over the last 40 years or so, I'd imagine is not too many.

Clearly, he had an idealized nostalgic view of what Cuba was. I'm sure if he visited, he might be fascinated. However, if he talked with Cubans...and perhaps had to live there for a year with rolling blackouts and the lack of work opportunities it provides, maybe he'd have a different view of it.

Various thoughts on Universal Health Care

Universal Health Care in the United States

If anything highlights the dysfunctional and perhaps self-destructive nature of politics, it is the health care debate that has been raging over the past month or so. Let me first question Obama's decision to push this in the summer, July and August are notoriously slow political months and certainly I do not believe it has helped his cause. Here's my various thoughts on the health care debate in this country.

#1- What are we getting for our taxes in this country?
In a brilliant Daily Show clip, John Oliver goes to a anti-tax tea party in New Jersey. A protester tells him "New Jersey has the highest property taxes in the nation" to which his biting reply is "And what are you getting for it, because this is an awful state!" I wonder the same thing about our taxes, surely as far as social programs go, health care should be a priority. Yet European nations almost universally have universal health coverage, and moderate-to-high tax rates. Spain, for example has a well funded education system, a fantastic public transportation network, and universal health care. What everyone says is "Oh, European socialists have tax systems that kill business." European politics does put a bit of a stranglehold on business, and while I have no evidence to back this up, I would put it down more to regulation and disincentives to entrepeneurship, innovation, and R&D more than the tax levels. Perhaps not in Northern Europe, but I don't know for sure. The point which rends all of this argument moot anyways, is that in several OECD (1st World Countries) such as Spain and Italy, they actually have lower tax rates than some places in the United States! There was an article in the left-leaning Spanish paper El Pais that pointed out that in New York, Massachusetts, New Jersey, California, and a few other predominantly Northeastern states, the overall tax rates are higher in the American states! Which begs the question of how efficiently our tax dollars are being spent. (answer: not

#2- Universal Health Care in a European form is not feasible for the United States
Our health care is generally pretty good, with advancing technology, new medications, and generally short wait times. The US can provide health care for all of its' citizens, though a European-style National Health Service is probably not apt for the process. Particularly in a time with economic crisis and unparalleled government deficits and debt, we simply cannot afford the $1 trillion-dollar plus systems they have. To Obama's credit, he has realized this and his plan would not replace private insurers as much as it would cover those unable to procure this insurance for a variety of reasons. Having just spent trillions to avert financial armageddon, the US simply does not have the finances for this. Nor is it necessarily the best plan. But I think Obama's plan, however much of a scaled-down version it is, is also not financially doable for the US. Frankly as it stands, no large-scale overhaul, of any social service right now. We're looking at a $2trillion deficit right now. Unless we want to burden further the future generations of Americans, our priority's right now are to stabilize the economy and slow the sea of debt that the United States government is drowning in.

#3- Republicans are wrong in their rhetoric
On the Republican side, "Swift-boat" style ads are drumming up fears of "death panels" drawing on a specific part of legislation that simply provides for end-of-life-planning. Like hospice care, getting your will together, etc. There's a lot of people with terminal conditions in this country and many more that very old. Life-planning is an extremely, rational, important step. There is the concern of scarcity and a government-run health care that would have red-tape amok and an inefficient bureaucracy, these are very legitimate concerns. However, the "health care is between you and your doctor" ad by anti-ObamaCare activists is ridiculous. There's already massive bureaucracies out there, they are called the insurance companies. I personally have dealt with them extensively and while they have always allowed me to take expensive exams and such in a timely manner, some of the smallest things like getting reimbursed for medication is a time-intensive process. The scarcity argument and bureaucracy are ones they should expound upon, they do bring up legitimate concerns but not surprisingly, are going about it in the wrong way. But do the ends justify the means? I can see an anti-ObamaCare advocate justifying it by saying the other topics are simply not sexy enough (financial issues, scarcity) so they have to drum it up to accomplish their goal, derailing national health care.

#4- Democrats are wrong in their planning and rhetoric
This shouldn't surprise anyone, as the only thing the two parties can ever agree on civilly is how to pad each others pockets and keep any real independent groups out of government. But the Dems are equally culpable as the Republicans on slander and misinformation. Let's start with the plan first, obvious in a wholly Democratic-led government, it is their responsibility to lead the way, and the GOP will simply play defense. That is exactly how the Dems behaved during the Bush administration, it's natural. But they have failed poorly here, it seems none can agree on specifically what they are aiming for. The Congressional Dems want one thing, Obama says another, and the Health Secretary says another thing. Are we looking at a universal health care system? Is it going to be government run, or like Fannie Mae and Freddy Mac (probably poor examples to bring up) government-sponsored. Often they talk about creating a health care cooperative, but I question whether one can be financially healthy when a sizeable portion of their mission would presumably be insuring people who have difficulty getting coverage from existing insurers. All in all, they have done a terrible job of articulating their plan to the point numerous Democrats have said they will not support the current bill. But they are wrong in their rhetoric as well, senior Democrats have labelled anti-ObamaCare activists as "an angry mob" and figuratively as archaic hillbillies who are stuck in the 19th century. These people have legitimate concerns about the size and scope of the US Federal government, and in light of the massive expansion of government over the past 2 years or so, they are fairly justified. The US government has taken over large banks, an automaker, and pumped trillions into the economy in exchange for equity.

I'll cut it off for now, even if I haven't fully developed my thoughts.

The Crisis

There's been a lot of talk of the unprecedented nature of the recession, and all of these pundits (who certainly won't be losing their job) are probably right. Unfortunately, nearly everyone is wrong about how to go about solving it.

Everyone remembers the Dot-Com bubble from the late 90s/early 2000s. Companies were sprouting up everywhere offering home delivery of groceries, the iSmell, or my favorite bust, the CueCat. Financing was seemingly ubiquitous, venture capital flowed throughout Silicon Valley. Of course, we all know how the story ends. Bankruptcies, a declining economy, and well, people realizing how idiotic half these products were (like absolutely everything in SkyMall) caused a rapid collapse of the industry. The bubble popped, as many put it.

The crisis is too complicated to simplify, but I'm going to attempt to address one of the principle problems. The economic downtown originated in the mortgage industry; easy (and careless) lending caused rapid speculation in the market. Much as there were too many CueCat companies out there in the market, there were too many mortgages being laid out. Both political parties have blamed one side, unfortunately neither has come out and blamed it on both. Democrats blame greedy and unscrupulous lenders for pushing mortgages, and Republicans blame the people for signing up for mortgages they couldn´t afford. Both are culpable.

This crisis hit America on Wall Street first and foremost. Most of these mortgages were sliced up, repacked, and sold to other banks. (I´m not sure how lots of very risky assets is much better than a few, but I guess simple probability less likely you'll lose all of your money) The crisis then spread throught America´s financial system, causing various bank collapses, most notably Lehman Brothers and WaMu. With a lack of liquidity and a general economic downturn (damn business cycles) this plunged the US into a recession.

One of my chief complaints about all the plans to fix the housing sector are this; there were too many CueCats in the market, and there was too much speculation in this bubble. All plans thus far have tried to maintain housing values, far above what they should be! Everyone in the political sphere has seemingly accepted this, after all, no one wants the values to plummet. But this is an insanely idiotic way to get out of this problem, one that will do nothing but haunt the market for decades to come. If the value of a good is too high due to speculation, it must fall to its market value. Artificially maintaining the price of a home/mortgage will help no one.

America Behind Bars

People like to commonly refer to democracy as "rule of the majority." This may be theoretically correct, but in most democracies in the world, it would more properly be described as "rule of the majority" while protecting the rights of the minority. The second part, as previously mentioned, is often forgotten but is an integral part of the situation.

Liberals, and Democrats, like to claim a monopoly on minority rights. During campaigns we hear them promising to "protect the downtrodden," and make the government work for the less priviliged. Republicans and conservatives also claim to protect minority rights, such as CEOs and business owners that have been villified by the media and the left.

However, though both claim to defend the "indefensible," with the success of the Republicans in the last few decades, Democrats have joined Republicans in the "law-and-order" campaign. Democrats promise to crack down on offenders while growing police numbers. This shift has caused a serious problem in American politics. No major party is willing to stand up for the criminals, unless they can score some talking points in doing so.

The numbers get worse and worse, the most recent survey shows that currently, as we speak, more than 1% of Americans adults are in prison, 2.3 million. Both in raw data, and per-capita, the United States leads the world in incarceration, ahead of countries like Russia, China, and Ukraine. One out of 9, more than 10% of young Black men are in prison. This is an absolute stain on the American government and American society. We are expending billions of dollars to imprison these people and losing untold dollars in lost potential.

Despite the stagnant crime rate, the incarceration rates have been steadily growing. Terrible policy like "Three Strikes laws" and the inherrent fear instilled in Americans have caused this growing crisis. In Kentucky, the crime rate rose 3% in approximately 30 years, while the state's inmate population rose 600%. This is an absolutely obscene number. Not only that, 1 in 32 Americans are either in prison or on parole. I couldn't find any statistics that indicate how many Americans have been in jail, but I would guess it is near 7-10%. This is a huge problem. Our incarceration rate per-capita is 6-7x the world average.

Why is it so high? Are Americans inherrently more criminal, or is our society less tolerant? Certainly not the former, the statistics are impossibly outside even several standard deviations. Who is to blame? Well, first, politicians, for their awful policies and campaigns to pander to voters. And secondly, of course, the voters. I'm not sure voters understand the magnitude of this situation. We created scapegoats for society's problems and no one, except organizations such as the ACLU and Libertarian Party, were willing to defend them.

How can we fix it? Ultimately, it rests with the voters. But we need to change the way this country looks at crime. First- no jail time for non-violent crimes. Before we campaign to legalize drugs (as I believe it's everyone's right to do whatever they want, if it doesn't hurt others) we should focus on decriminalizing drugs. There is no reason to throw drug users in jail, as long as they aren't committing other crimes. Fine them and send them on their way. It is mutually beneficial to both sides.

A Houston-based Texan State Senator said, “We have 5,500 D.W.I offenders in prison,” he said, including people caught driving under the influence who had not been in an accident. “They’re in the general population. As serious as drinking and driving is, we should segregate them and give them treatment.”

We need to lessen the amount of non-violent offenders who go to jail. Repeat offenders need help, not jail time. Parole violators deserve fines, not to be thrown back into jail. Sadly, in this two-party system, we are going to need one of the parties to stand up and have courage. They need to defend those who society, and the media have already convicted. Unless there is a change in culture...we are going to continue down this path and more defenseless Americans are going to be serving time in prison.

Immigration Reform- Necessary, or Bullshit?

So, for those of you who haven't noticed, President Bush suffered legislative defeat #53025 of his second term, his push to reform immigration. It wasn't a completely awful bill, it wasn't good, but it was at least a step in the right direction. To briefly summarize, it provided a legal path to citizenship for the 10-20million illegal aliens (read:Mexicans) in our country while stepping up border security. While I don't necessarily agree with building a fence, I think legalizing those people already here was extremely important.

Sidenote to President Bush: When you are heavily relying on your weakened base to support an extremely unpopular war, do not push an immigration bill that they don't like, and more importantly, don't push it standing next to Ted Kennedy.

I don't understand the Pat Buchanans and Tom Tancredos of the US. They, if you did not know, are virulently anti-illegal-immigration. Rep. Tancredo is even running for President on the Republican line solely on his immigration stance.

First of all, at one time or another (save the Native Americans) we all had immigrants come over. I sometimes wonder about the legality of my Italian-ancestors showing up at Ellis Island and passing through. (seems like open immigration) They certainly didn't apply for Visas or Green Cards back home, they just hopped on a boat and came over. Tom Tancredo's grandparents all migrated here from Italy. Mine came from England, Germany, Italy, and a host of other countries. Mr. Tancredo and all should investigate the 3rd generation rule. Based on polls and surveys (which I have no link to, sorry) the grandchildren of the immigrants have no real connection to the homeland. They generally speak little of the language and don't identify with the country. A good example of this is a good friend of mine. His grandmother barely speaks English, (she's Italian) his mom speaks Italian and has visited Italy several times. My friend knows no Italian and really has no attachment to Italy, other than cheering for the Nazionale in the World Cup.

Secondly, immigration makes America far better off. Italians (in addition to every ethnic group) add an interesting and valuable part to American culture. Where would we be without the Godfather, Scorcese, Pacino, De Niro, lasagna, and all the little Italys? You can name contributions to America by just about every ethnicity. We are more diverse, more interesting, and more unique because of immigration. I have friends with Italian, German, South Korean, Chinese, African, English, French, Russian and Indian ancestries. With all of these cultures we forged a new culture, Americana. And if you haven't noticed, it's quite popular worldwide.

Thirdly, none of us chose to be born an American citizenship. I've often heard "It's ridiculous to be proud of your country when you didn't pick it" which is true at birth, but it doesn't apply when you have experience and personal history with a country. So why are we any better than anyone else? Should I be able to enjoy living in America and not Senor Juan? I firmly believe the answer to both is a resounding no. He has every right to be here that I do. If you and I were Mexican, I think there's a good chance we would be crossing over la frontera to come for jobs here as well.

Immigration adds a valuable element to the American nation and it is inexcusable to refuse entry to millions of people just because they didn't happen to be born here. Remember, a hundred years ago politicians were whining about the masses of Italians and Chinese coming into the country, with all the same complaints as today. Now, those immigrants descendents are a normal and critical part of American culture. Given a few decades, I'm sure Mexicans will be as well.

Violent Crime in New Orleans

This picture will never fully convey the anguish and the pain going on in New Orleans. For every red dot on this GoogleMap image of New Orleans, there has been a murder in 2007. We are only 6 months into the year, it is likely that this map will continue to be colored red. In 2006, a Tulane University professor estimated that the murder rate was the highest ever recorded in the United States, beating New Orleans previous national record set in 1994, when 425 people were killed. In July 2006 alone, 26 people were killed. By comparison, in the same month, 43 US soldiers were killed in Iraq. There's something seriously wrong when a city is losing almost as many people as an occupying force in a warzone. Compared per capita, it's disturbingly close, considering we are not in a war. (New Orleans had an estimated population 223,000 in July '06, the US had about 140,000 troops in Iraq, and given the fact that Iraq is much much much larger than the city of New Orleans.)

New Orleans is down on its' knees, and the murder rate is killing our potential reconstruction and rebirth. The city is beginning to see white flight, which threatens us economically and culturally. The violence is a huge deterrent to tourism, which accounts for 40% of New Orleans income as well as 85,000 people. (Not including the multiplier effect) Combining these two losses, it's unlikely rebuilding will proceed at any reasonable rate and the already-strained social services will be cut back even further. While the influx of Latinos (to a traditionally "Chocolate City") has provided cheap labor to aid reconstruction, it has fuelled a violent drug gang war between Blacks and Hispanics.

What's the solution? I'm not sure, but I am sure what's in place is not working. It is clear that the city of New Orleans needs federal and state aid, they do not have money to police the entire city. (One reason why they commissioned University Police as full police officers at all New Orleans colleges this Spring) This deficit only allows for more violence which perpetuates the downward spiral. A dearth of economic and educational opportunity also causes the violence. New Orleans public schools are barely functional, I can't even imagine what the dropout rate is. Good decent paying jobs are leaving the area and we are left with dead-end reconstruction which is generally being filled by imported Mexicans.

To save New Orleans, the city, state, and federal governments need to act. We need to immediately deploy more police to stop the senseless killings, but at the same time we need functional schools. New Orleans and Louisiana needs to woo companies to come to New Orleans (the 4th largest port in America and within 30 miles of the 4th largest port in the world) to provide decent jobs to attract talent to the city. (Read: wealthy taxpayers) We need to rebuild the oil and gas infrastructure destroyed during Katrina. (Southern Louisiana is the 2nd biggest oil refiner in the US after Texas. Wonder why gas prices shot up during Katrina and still remain high? We're still operating far below capacity)

Whatever the solution, Nagin, Blanco and others must act now, otherwise New Orleans is well on track to reclaim the ignominious title of the United States' murder capital for the 3rd year in the 21st century.